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ICICI Bank Ltd.
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ICICI Bank Ltd.

  • 489.457.60 (1.58%)
  • Live
  • As On: 09:44 AM IST
OPEN TRADING A/C
  • Open483.70
  • High489.50
  • Low483.00
  • Prev Close481.85
  • Volume46,06,268
  • VWAP(₹)486.13
  • Buffer of stake in subsidiaries

    The bank used treasury gains from the two per cent stake sale in I-Sec to create further Covid provisions. There are a number of its subsidiaries which create enough scope to dilute its stake and raise resources.
  • Excess liquidity

    There is excess liquidity in the system which leads to a compression in the NIM (Net Interest Margin) in the short term. The challenge is to find the right quality of borrower, both in corporate and retail space. This issue might continue till clarity emerges on repayments coming from the moratorium loan book.
  • Addition to network

    The bank has a network of 5,324 branches. Out of this, 50 per cent are in the semi-urban and rural areas. The bank added 1,151 branches and ATMs in FY-20, taking the total banking outlets to 21,012.
  • Addition to human capital

    In fiscal 2020, the average staff strength increased to 97,682 from an average of 84,523 in FY-19, an increase of 13,159. These additions were primarily in the retail and rural businesses, indicating the areas where the bank is focusing.

Key Metrics

  • PE Ratio(x)24.21
  • EPS - TTM(₹)20.19
  • MCap(₹ Cr.)3,34,984
  • MCap Rank3
  • PB Ratio(x)2.44
  • Div Yield(%)0.47
  • Face Value(₹)2.00
  • 52W High(₹)552.20
  • 52W Low(₹)268.30
  • MCap/Sales2.48
  • Beta(1 Month)1.09
  • BV/Share(₹)188.15

Returns

  • 1 Day1.41%
  • 1 Month11.81%
  • 3 Months31.16%
  • 1 Year-7.67%
  • 3 Years60.61%
  • 5 Years105.59%

Financials

    • Beating 3 Yr Revenue CAGR

      Company's annual revenue growth of 14.07% outperformed its 3 year CAGR of 9.62%. (Source: Consolidated Financials)
    • Quarterly Revenue Growth Comparison

      Company reported total income growth on both quarterly & yearly basis. Total income for Sep 30, 2020 quarter was Rs 39321.42 cr which is an increase of 3.64% QoQ and 5.07% YoY. (Source: Consolidated Financials)
    Sep 2020Jun 2020Mar 2020Dec 2019Sep 2019
    Total Income39,321.4237,939.3240,121.4838,370.9537,424.78
    Total Income Growth (%)3.64-5.444.562.5310.50
    Provisions & Contingencies3,049.957,704.586,598.212,131.442,725.80
    Provisions & Contingencies Growth (%)-60.4116.77209.57-21.80-23.40
    Profit after Tax (PAT)4,882.333,117.681,251.324,670.101,131.19
    PAT Growth (%)56.60149.15-73.21312.85-55.00
    Gross NPA (%)-----
    Net NPA (%)-----
    Net Profit Margin (%)12.428.223.1212.173.02
    Basic EPS (₹)7.304.821.937.221.75
    Sep 2020Jun 2020Mar 2020Dec 2019Sep 2019
    Total Income23,650.7726,066.9523,443.6623,638.2622,759.52
    Total Income Growth (%)-9.2711.19-0.823.866.33
    Provisions & Contingencies2,995.277,593.955,967.442,083.202,506.87
    Provisions & Contingencies Growth (%)-60.5627.26186.46-16.90-28.29
    Profit after Tax (PAT)4,251.332,599.151,221.364,146.46654.96
    PAT Growth (%)63.57112.81-70.54533.09-65.67
    Gross NPA (%)5.175.465.535.956.37
    Net NPA (%)1.001.231.411.491.60
    Net Profit Margin (%)17.989.975.2117.542.88
    Basic EPS (₹)6.354.011.896.411.01
    FY 2020FY 2019FY 2018FY 2017FY 2016
    Total Income1,49,786.101,31,306.501,18,969.101,13,397.631,01,395.85
    Total Income Growth (%)14.0710.374.9111.8412.39
    Provisions & Contingencies22,377.2122,180.9219,851.8819,051.5015,682.92
    Provisions & Contingencies Growth (%)0.8811.734.2021.4857.89
    Profit after Tax (PAT)9,566.314,254.247,712.1910,188.3810,179.96
    PAT Growth (%)97.31-37.48-19.763.78-15.57
    Net Interest Margin (%)2.912.642.482.642.75
    Net Profit Margin (%)11.275.9112.4016.7117.16
    Basic EPS (₹)14.816.6112.0215.9117.53
    FY 2020FY 2019FY 2018FY 2017FY 2016
    Total Income91,246.9477,913.3672,385.5273,660.7668,062.49
    Total Income Growth (%)17.117.64-1.738.2311.09
    Provisions & Contingencies20,170.4620,074.6017,964.1116,685.6614,137.25
    Provisions & Contingencies Growth (%)0.4811.757.6618.0365.45
    Profit after Tax (PAT)7,930.813,363.306,777.429,801.099,726.29
    PAT Growth (%)135.80-50.37-30.850.77-12.97
    Net Interest Margin (%)3.022.802.612.812.94
    Net Profit Margin (%)10.605.3012.3318.0918.44
    Basic EPS (₹)12.285.2310.5615.3116.75

    All figures in Rs Cr, unless mentioned otherwise

  • AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Advances7,06,246.116,46,961.685,66,854.225,15,317.314,93,729.11
    Advances Growth (%)9.1614.1310.004.3712.60
    Deposits8,00,784.466,81,316.945,85,796.115,12,587.264,51,077.39
    Deposits Growth (%)17.5316.3114.2813.6416.87
    Total Equity1,29,751.341,20,829.271,16,632.311,09,491.0597,459.66
    Total Equity Growth (%)7.383.606.5212.3511.76
    Gross NPA (%)-----
    Net NPA (%)-----
    Capital Adequacy Ratios (%)-----
    Contingent Liabilities30,03,053.5326,12,071.9418,91,035.8313,07,841.5910,70,233.91
    AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Advances6,45,289.975,86,646.585,12,395.294,64,232.084,35,263.94
    Advances Growth (%)10.0014.4910.376.6612.32
    Deposits7,70,968.996,52,919.675,60,975.214,90,039.064,21,425.71
    Deposits Growth (%)18.0816.3914.4816.2816.56
    Total Equity1,16,504.411,08,368.041,05,158.9499,951.0789,735.58
    Total Equity Growth (%)7.513.055.2111.3811.57
    Gross NPA (%)6.047.38-8.745.82
    Net NPA (%)1.542.295.435.432.98
    Capital Adequacy Ratios (%)16.1116.8918.4217.3916.64
    Contingent Liabilities25,23,825.8019,22,038.2912,89,244.0010,30,993.718,53,520.77

    All figures in Rs Cr, unless mentioned otherwise

    • Increase in Cash from Investing

      Company has used Rs 42308.43 cr for investing activities which is an YoY increase of 40.34%. (Source: Consolidated Financials)
    AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Net Cash flow from Operating Activities79,564.7548,671.0519,382.9352,635.5323,645.32
    Net Cash used in Investing Activities-42,308.43-30,147.22-50,573.45-1,605.74-11,819.26
    Net Cash flow from Financing Activities2,992.18-19,997.4339,675.97-35,469.545,813.91
    Net Cash Flow40,462.03-1,608.248,508.2615,454.9017,398.80
    Closing Cash & Cash Equivalent1,27,852.9287,390.9088,999.1380,490.8765,035.97
    Closing Cash & Cash Equivalent Growth (%)46.30-1.8110.5723.7636.52
    AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Net Cash flow from Operating Activities78,449.4438,418.7913,303.6539,222.8122,428.47
    Net Cash used in Investing Activities-37,107.40-23,875.31-38,968.807,045.42-3,949.98
    Net Cash flow from Financing Activities-2,644.55-18,251.0934,118.30-30,378.79-585.07
    Net Cash Flow38,859.45-3,873.098,456.3215,844.3217,564.13
    Closing Cash & Cash Equivalent1,19,155.7480,296.2984,169.3875,713.0659,868.74
    Closing Cash & Cash Equivalent Growth (%)48.40-4.6011.1726.4741.52

    All figures in Rs Cr, unless mentioned otherwise

  • AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Return on Equity (%)7.983.827.1610.0311.15
    Return on Assets (%)0.690.340.681.031.10
    Cost to Income (%)62.6865.8363.5559.2755.69
    Interest income to Earning assets (%)6.155.815.526.186.45
    Interest Expense to Earning assets (%)3.243.163.043.533.70
    Price to Earnings (x)21.9860.6123.2615.8513.53
    Price to Book (x)1.752.311.661.591.51
    Price to Sales (x)2.483.572.882.652.32
    Operating Profit Margin (%)-63.32-74.51-76.74-67.47-52.57
    AnnualFY 2020FY 2019FY 2018FY 2017FY 2016
    Return on Equity (%)6.993.196.6310.1111.19
    Return on Assets (%)0.720.340.771.261.34
    Cost to Income (%)45.7948.9846.5142.6839.40
    Interest income to Earning assets (%)6.806.576.257.017.31
    Interest Expense to Earning assets (%)3.783.773.634.204.37
    Price to Earnings (x)26.5376.9226.4616.4714.16
    Price to Book (x)1.852.441.751.671.58
    Price to Sales (x)2.814.063.262.982.61
    Operating Profit Margin (%)-11.38-17.58-19.36-17.91-10.61
    • Watch for resolution of large stressed assets

      The process of resolution of large stressed accounts continued during the year. Further, additions to the non-performing pool of banks declined during the year. However, challenges continued for the nonbanking financial companies (NBFCs) and housing finance companies during fiscal 2020, with subdued growth and moderation in available market funding.

    • Focusing on credit monitoring

      The Bank’s immediate focus in fiscal 2021 would be towards maintaining adequate liquidity, conservation of capital and robust credit monitoring. Given the Bank’s core operating profitability, liquidity and capital adequacy, the Bank believes it is well-placed to absorb the impact of the challenges in the environment.

    • Covid trouble adds to headwinds

      The Bank’s business is expected to be impacted by lower lending opportunities and revenues in the short to medium term. The impact of the Covid-19 pandemic on Bank’s results, including credit quality and provisions, remains uncertain and dependent on the spread of Covid-19, further steps taken by the government and the central bank to mitigate the economic impact, steps taken by the Bank and the time it takes for economic activities to resume at normal levels.

Technicals

  • 5 Day EMA Crossover

    Bullish signal on daily chart

    Appeared on: 1 Dec 2020

    5D EMA: 478.42

    Last Signal 24 Nov 2020 (Gain 2.46%)

    Average price gain of 2.96% within 7 days of Bullish signal in last 5 years

    10 Day EMA Crossover

    Bullish signal on daily chart

    Appeared on: 1 Dec 2020

    10D EMA: 476.46

    Last Signal 26 Nov 2020 (Gain 0.89%)

    Average price gain of 2.90% within 7 days of Bullish signal in last 5 years

  • 47%
    Positive Movement
    since 1st Jan 2005
    on basis
    53%
    Negative Movement
    since 1st Jan 2005
    on basis
    Exclude

    Global Meltdown1st Jan 2008 to 10th Nov 2008

    Covid Crisis1st Feb 2020 to 31st Mar 2020

  • R1484.95Pivot

    481.90

    S1478.80
    R2488.05S2475.75
    R3494.20S3469.60
  • 5 Days14 Days28 Days
    12.5814.4514.55

Peers

    • CHART
    • TABLE
    • 1D
    • 1W
    • 1M
    • 3M
    • 6M
    • 1Y
    • 5Y
  • NAMEP/E (x)P/B (x)ROE %ROA %Rev CAGR [3Yr]OPMNPM
    ICICI Bank24.041.757.980.699.62-63.3211.27
    Kotak Bank39.893.7212.891.9313.86-24.7425.67
    Axis Bank52.141.242.140.1911.48-22.692.90
    IndusInd Bank24.220.7112.941.4524.10-8.6615.48
    Bandhan Bank22.312.1619.893.2941.7513.5427.77
    Add More
    Annual Ratios (%)

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    • YES Bank
    • IDFC First Bank
    • City Union Bank
    • Federal Bank
    • RBL Bank

    Choose from Stocks

    Shareholding Patterns

    • Category30 Sep 202030 Jun 202031 Mar 202031 Dec 2019
      Promoters0.000.000.000.00
      Pledge0.000.000.000.00
      FII45.6842.9943.7345.82
      DII43.7045.7344.5843.14
      Mutual Funds27.0728.2827.6125.98
      Others10.6211.2811.6911.04
    • CategoryNo. of SharesPercentage% Change QoQ
      FII2,57,53,53,34045.68 %2.69
      DII2,46,37,17,87043.70 %-2.03
      MF1,52,58,28,92727.07 %-1.21
      Others1,85,71,51,93910.62 %-0.66

    Mutual Funds Ownership

    MF Ownership as on 31 October 2020

    • Equity: Large Cap
      • 3,990.03

        Amount Invested (in Cr.)

      • 5.39%

        % of AUM

      • -4.53

        % Change (MoM basis)

    • Hybrid: Dynamic Asset Allocation
      • 2,357.50

        Amount Invested (in Cr.)

      • 6.79%

        % of AUM

      • 0.00

        % Change (MoM basis)

    • Equity: Large Cap
      • 1,920.88

        Amount Invested (in Cr.)

      • 6.25%

        % of AUM

      • -2.77

        % Change (MoM basis)

    Futures & Options

      • Expiry Month
      DatePrice

      27-09-2020Current

      487.702.85 (0.59%)

      486.00
      Open
      488.40
      High
      485.05
      Low
      484.85
      Prev Close
      1,562
      Contracts Traded
      10,467.49
      Turnover (₹ Lakhs)
      • Type
      • Expiry Month
      • Strike Price
      DatePrice

      27-09-2020Current

      0.00-96.05 (-100.00%)

      0.00
      Open
      0.00
      High
      0.00
      Low
      96.05
      Close
      0
      Contracts Traded
      0.00
      Turnover (₹ Lakhs)

    Corporate Actions

    • General Meeting

      -

      Jul 13, 2020

      General Meeting

      -

      Jul 09, 2020

      Board Meeting

      To consider raising of funds

      Jul 06, 2020

    • Announced onMeeting on
      Jul 03, 2020Jul 25, 2020
      Quarterly Results
      Jul 06, 2020Jul 08, 2020
      To consider raising of funds
      May 05, 2020May 09, 2020
      Audited Results & Others
      Dec 26, 2019Jan 25, 2020
      Quarterly Results
      Sep 25, 2019Oct 26, 2019
      Quarterly Results
    • Announced onEx-DateDividend%
      Apr 27, 2015Jun 04, 2015250%
      Apr 29, 2016Jun 16, 2016250%
      May 04, 2017Jun 20, 2017125%
      May 07, 2018Aug 24, 201875%
      May 06, 2019Jul 22, 201950%
    • Announced onEx-Date
      May 03, 2017Jun 20, 2017
      Bonus Ratio: 1 share(s) for every 10 shares held
    • Announced onEx-Date
      Sep 09, 2014Dec 04, 2014
      Split: Old FV10.0| New FV:2.0
    • No Data Available

    • Announced onMeeting on
      Jul 13, 2020Aug 14, 2020
      -
      Jul 09, 2020Aug 10, 2020
      -
      May 06, 2019Aug 09, 2019
      Book closure from Jul 24, 2019 to Aug 9, 2019
      May 07, 2018Sep 12, 2018
      (Revised)
      May 10, 2017Jun 13, 2017
      -

    About

    ICICI Bank Ltd., incorporated in the year 1994, is a banking company (having a market cap of Rs 334604.75 Crore).

    ICICI Bank Ltd. key Products/Revenue Segments include Interest & Discount on Advances & Bills which contributed Rs 57551.11 Crore to Sales Value (76.94 % of Total Sales), Income From Investment which contributed Rs 14673.21 Crore to Sales Value (19.61 % of Total Sales), Interest which contributed Rs 1891.85 Crore to Sales Value (2.52 % of Total Sales) and Interest On Balances with RBI and Other Inter-Bank Funds which contributed Rs 682.15 Crore to Sales Value (0.91 % of Total Sales)for the year ending 31-Mar-2020.

    The Bank has reported a Gross Non Performing Assets (Gross NPAs) of Rs .00 Crore (.00 % of total assets) and Net Non Performing Assets (Net NPAs) of Rs .00 Crore (.00% of total assets).

    For the quarter ended 30-09-2020, the company has reported a Consolidated Interest Income of Rs 14805.93 Crore, down -3.45 % from last quarter Interest Income of Rs 15335.70 Crore and down -2.18 % from last year same quarter Interest Income of Rs 15136.52 Crore. The bank has reported net profit after tax of Rs 5426.33 Crore in latest quarter.

    The bank’s top management includes Mr.Anup Bagchi, Ms.Rama Bijapurkar, Ms.Neelam Dhawan, Mr.Uday Chitale, Mr.Sandeep Batra, Mr.Sandeep Bakhshi, Mr.S Madhavan, Mr.Radhakrishnan Nair, Mr.Lalit Kumar Chandel, Mr.Hari L Mundra, Mr.Girish Chandra Chaturvedi, Mr.B Sriram, Ms.Vishakha Mulye. It has Walker, Chandiok & Co.LLP as its auditoRs As on 30-09-2020, the company has a total of 6,896,223,149 shares outstanding.

    About ICICI Bank

    ICICI Bank Ltd., incorporated in the year 1994, is a banking company (having a market cap of Rs 334604.75 Crore). Show More

    Key Indices Listed On

    Nifty 50, S&P BSE Sensex, Nifty Bank, Nifty 100, Nifty 200

    Address

    ICICI Bank Tower,Near Chakli Circle,Old Padra Road,Vadodra, Gujarat - 390007

    Executive Leadership

    AM

    Ajay Mittal

    Chief Accountant
    AB

    Anup Bagchi

    Executive Director
    BS

    B Sriram

    Independent Director
    GC

    Girish Chandra Chaturvedi

    Non Exe.Part Time Chairman
    Show More

    Auditors

    Walker, Chandiok & Co.LLP

    ICICI Bank Share Price Update

    ICICI Bank Ltd. share price moved up by 1.58% from its previous close of Rs 481.85. ICICI Bank Ltd. stock last traded price is 489.45

    Share PriceValue
    Today/Current/Last489.45
    Previous Day481.85

    DATA SOURCES: TickerPlant (for live BSE/NSE quotes service) and Dion Global Solutions Ltd. (for corporate data, historical price & volume, F&O data). Sensex & BSE Quotes and Nifty & NSE Quotes are real-time and licensed from BSE and NSE respectively. All timestamps are reflected in IST (Indian Standard Time).

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    Markets Data

    *

    Key Metrics

    • This is a ratio arrived at by dividing the current market price of a stock by its latest (annual or annualized) earnings per share. Here we have taken the TTM (trailing twelve months) adjusted earnings per share.

    • Earnings per share (TTM) tells the profit after tax earned on a per share basis by a stock over the last twelve months or four quarters.

    • MCap or Market capitalization of a stock is calculated by multiplying the total number of shares outstanding of that particular stock with its current market price.

    • This is the ranking of a company within its sector based on MCap or Market capitalization. Higher the market capitalization of a company, higher the rank it is assigned.

    • Price to Book represents the ratio of current market price of a stock to its book value per share. The book value itself is arrived at by dividing the net worth of a company by the total number of shares outstanding of the company at that time.

    • Dividend Yield calculates the amount of full year dividend declared by a company as a percentage of the current market price of a stock. All other things being equal, higher the dividend yield of the stock, the better it is for investors.

    • Face value of a stock is the value ascribed to the stock as per the balance sheet of the company. The dividend declared by a company is usually declared as a percentage of face value.

    • Beta (β) is a measure of systematic risk. It describes the responsiveness of a stock to fluctuations in the market. Beta coefficient of more than 1 denotes that a security is more volatile than its benchmark and less than 0 signifies that security return is not correlated to market movement.

    • Volume Weighted Average Price represents the average price of a security over a particular time period (example one trading day) weighted by the volume traded at each price point.

    • This represents the 52 week high and low price of the security. It is also the 1 year high and low of the security. This represents the highest and lowest price touched by the security during the past 52 weeks or 1 year including today.

    • Book value represents the value arrived at by subtracting the total liabilities from the total assets of the company. On dividing this value with the total number of shares outstanding for the company, we can arrive at book value per share. Book value is also known as Net Asset Value of a company.

    • This is a ratio of market capitalisation of a company’s stock to its annual sales. The market capitalization here is taken for the fully paid-up equity share of the company.

    Technicals

    • Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

      Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

    • Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

      Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

    • Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

      Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged. It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.

    • Pivot points are indicative support and resistance levels which are calculated on basis of previous day’s high, low and closing prices. Pivot level for Monday’s trade would be based on Friday’s prices and Monday’s, high, low and close price would go into calculation of pivot levels for Tuesday’s trading session.

      There are two underlying assumptions in pivot points. First, the specific price level indicated by R1, R2 and R3 may act as a barrier or resistance in an uptrend. So, if a stock moves up above these pivots levels, the uptrend gets confirmed. Second these specific price levels may see an increased activity, hence may be used as levels to book profit by traders with a long positions. For traders with short position, these points are often helpful in determining what should be the stop loss for a trade.

      Similarly, in case of support levels as indicated by S1, S2 and S3, they may act as price level where a stock might get a breather when it is slipping southward. In case these supports levels are broken it is a confirmation of a down trend. The stock may also see increased activity close to pivot levels. They may be used by trader may use them to put stop loss for a long trade. If a trader has short position, the pivot level may help in determine a level, where profit may be booked.

      Like any other technical indicator, pivots levels cannot and should not be used as single factor while taking a trading decision. They should be combined with other technical indicators. It could be short term moving averages, stochastic, moving average convergence divergence (MACD) or overbought level as indicated by relative strength index (RSI). For example, if a breakdown of support level (S1, S2 or S3) is accompanied with stock price also moving below its short term moving average or stochastic on daily charts giving a sell signal, it would add to weightage to the decision of taking a short trade.