Stocks to buy: Indian stock market benchmark Nifty 50 ended flat last week amid persistent concerns over inflation, dim prospects of rate cuts in the near future, geopolitical tensions and premium valuation of the domestic market.
Experts believe the market may remain in a range ahead of the general election outcome. At the same time, the ongoing season results will infuse stock-specific movements.
On the macro front, the eurozone GDP data and the Bank of England (BoE) policy decision will be the focus of this week.
On the technical front, the market is showing signs of weakness and a further correction may be possible.
“The Nifty index shows signs of near-term bearishness as it forms a double top pattern on the daily chart, coupled with a bearish engulfing candle. This suggests a sell-on-rise approach in the market,” said Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities.
“Immediate resistance is noted at the 22,600-22,700 zone, where aggressive call writing has been observed in the options market. On the downside, the index has immediate support at 22,300, and a breach below this level could accelerate the downside momentum,” he said Shah.
Also Read: Indian stock market: 8 key things that changed for market over weekend – Gift Nifty, US jobs data to Nasdaq rally
For the short term, market experts suggest picking stocks with strong technical indicators. Based on the recommendations of several experts, here are 9 stocks that can rise 6-15 per cent in the next 3-4 weeks. Take a look:
Axis Securities
Orient Electric | Last traded price (LTP): ₹229.50 | Buying range: ₹226-222 | Target price: ₹240-250 | Stop loss: ₹216 | Upside potential: 9%
Orient Electric has demonstrated a breakout above the medium-term falling channel pattern at ₹225 on the weekly chart, suggesting the onset of an uptrend.
The stock is holding above key moving averages of 20, 50, 100, and 200 days, indicating an uptrend in both the short and medium term.
The stock’s closing above the daily upper Bollinger Band also signals a short-term buying opportunity.
The weekly RSI holds above its reference line, indicating positive bias.
Also Read: Stocks to Watch: Kotak Mahindra Bank, DMart, Mahindra Finance, Britannia, Titan, Inox Wind
BASF India | LTP: ₹4,062.50 | Buying range: 4,030-3,950 | Target price: ₹4,550-4,650 | Stop loss: ₹3,710 | Upside potential: 14.5%
On the weekly chart, BASF has broken out above the rounded bottom pattern at ₹3,900 with a strong bullish candle, signaling the continuation of the uptrend.
The stock is forming higher highs and higher lows on the weekly chart, while also maintaining above an upward-sloping trendline, indicating an upward bias.
The stock’s closing above the weekly upper Bollinger Band also signals a medium-term buying opportunity.
The weekly RSI holds above its reference line, indicating positive bias.
Indiamart Intermesh | LTP: ₹2,799.65 | Buying range: ₹2,780-2,726 | Target price: ₹3,060-3,185 | Stop loss: ₹2,598 | Upside potential: 14%
On the daily chart, Indiamart Intermesh has broken out above the symmetrical triangular pattern at ₹2,700 with a breakaway gap area and a strong bullish candle, indicating the start of an uptrend.
During pattern formation, volume activity tends to decline, while at the breakout, there is an increase in activity, indicating an influx of market participation.
The stock rallied sharply after the breakout, retraced to retest the 200-day simple moving average (SMA) at ₹2,768, and found support, confirming a positive bias.
The daily RSI has also given a crossover above its reference line, generating a buy signal.
Also Read: Day trading stocks to buy: IOC, BHEL, Sun Pharma — Anand Rathi expert recommends three shares to buy today — May 6
Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers
Dr. Reddy’s Laboratories | LTP: ₹6,349.55 | Buying range: ₹6,275-6,350 | Target price: ₹6,700 | Stop loss: ₹6,111 | Upside potential: 6%
DR Reddy’s showed a strong uptrend with higher highs and higher lows on a weekly scale, indicating sustained upward momentum and bullish sentiment.
Recent trading saw support at the middle Bollinger band, suggesting a potential rebound.
The stochastic oscillator remained resilient, avoiding oversold conditions and showing a bullish crossover near the 25 level on the weekly scale.
“This alignment suggests a favorable moment for traders to consider long positions, with entry recommended between ₹6,275-6,350 for a projected upside target of ₹6,700. A stop loss near ₹6,111, based on daily closing prices, is advised to manage downside risk,” said Patel.
Piramal Enterprises | LTP: ₹962.20 | Buying range: ₹945-965 | Target price: ₹1,060 | Stop loss: ₹902 | Upside potential: 10%
Piramal Enterprises has found support at the 0.618 per cent retracement level from its previous upward movement between April 3, 2023 and September 11, 2023.
Before this, it consolidated within the range of ₹820-900 for approximately a month.
On the indicator side, weekly stochastics exhibit regular bullish divergence on a weekly scale, suggesting a favorable buying opportunity.
“Initiating long positions within the range of ₹945-965 with an upside target of ₹1,060 is recommended. A stop loss near ₹902, based on daily closing prices, is advised to manage potential downside risk,” said Patel.
Cipla | LTP: ₹1,424.75 | Buying range: ₹1,400-1,430 | Upside target: ₹1555 | Stop loss: ₹1345 | Upside potential: 9%
On a weekly scale, Cipla demonstrated a robust uptrend, marked by higher highs and higher lows; signaling sustained upward momentum and bullish sentiment.
Recent trading sessions found support at the middle Bollinger band, hinting at a potential rebound.
Additionally, the stochastic oscillator showed resilience and indicated hidden bullish divergence and a bullish crossover, further reinforcing the bullish outlook.
“This alignment presents a favorable opportunity for traders to consider long positions, with an entry between ₹1,400-1,430 and a projected upside target of ₹1,555. To manage downside risk, a stop loss near ₹1,345, based on daily closing prices, is recommended,” said Patel.
Shiju Koothupalakkal, a technical research analyst at Prabhudas Lilladher
The stock recovered significantly from the low near the 200-period moving average (MA) of ₹317.
Thereafter, it witnessed a decent pullback to improve the bias.
A breakout above the inverted head and shoulder pattern formation on the daily chart has strengthened the trend and signaled a further rise in the coming days.
The RSI is on the rise, and with much upside potential visible from current levels, its upward move may continue.
Zydus Lifesciences | LTP: ₹997.40 | Target price: ₹1,150 | Stop loss: ₹937 | Upside potential: 15%
After the short correction, the stock has taken support near the important 50EMA (exponential moving average) level of ₹928 and indicated a decent pullback with improvement in the bias to form a higher low pattern on the daily chart.
The RSI has cooled off from the highly overbought zone, is currently indicating a trend reversal, and has signaled a buy.
Birla Corporation | LTP: ₹1,559.90 | Target price: ₹1,770 | Stop loss: ₹1,440 | Upside potential: 13.5%
The stock has corrected quite significantly from the ₹1,800 level and recently formed almost a higher low on the daily chart, taking support near the ₹1,420 level.
It has witnessed a decent pullback to move past the confluence of moving averages of 50EMA and 100 period MA at the ₹1,500 level to improve the bias and further rise is anticipated.
The RSI has indicated a trend reversal, signaling a buy, and has the potential to carry on with the positive move further ahead.
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Disclaimer: The views and recommendations above are those of individual analysts, experts and brokering companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.
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