Look for 21,800; 2 stocks to buy: Aditya Agarwala

Aditya Agarwala, Co-founder & Director, Invest4edu, says “I am looking at a target of 46,500 to about 46,700 on the Bank Nifty and I believe there is more money-making opportunity in the banking stocks from here on. Talking of Nifty, yes, definitely, it is still locked in that range between 21,800 and 21,200 on the downside. Till the time the Nifty scales past 21,800, I am not looking at going aggressive long on the markets.”

How are you placing your trading bets right now?

Aditya Agarwala: Clearly, it is a bounce back, no doubt about that and if you take a look at the last three trading sessions, including today, we had a massive up move and then yesterday was a corrective move and today again we have an up move. Usually, it is the order of the markets heading into budget and a lot of people can say that it is an interim budget just for two months, so one should not look too much into it.


Unlock Leadership Excellence with a Range of CXO Courses

Offering College Course Website
IIM Lucknow IIML Chief Operations Officer Programme Visit
Indian School of Business ISB Chief Digital Officer Visit
IIM Kozhikode IIMK Chief Product Officer Programme Visit

But the people are also factoring in the return of the same government. So, a lot of policies taken into this Budget can actually be implemented in the actual budget once the government presents a full-fledged budget, and that is why this Budget could actually hold some significance if not the prior interim budgets.

Having said that, yes, markets are charging ahead and the one index to particularly point out is the Bank Nifty, because that is one which is charging ahead and this kind of an up move we have seen in Bank Nifty after a significant time. Post HDFC numbers, Bank Nifty has been underperforming. Today is the day when Bank Nifty has actually started to outperform and look at the heavyweights, HDFC, Axis, ICICI, SBI, PNB all are chipping in and I believe Bank Nifty is something that can continue to outperform heading into budget and tomorrow as well.

I am looking at a target of 46,500 to about 46,700 on the Bank Nifty and I believe there is more money-making opportunity in the banking stocks from here on. Talking of Nifty, yes, definitely, it is still locked in that range between 21,800 and 21,200 on the downside. Till the time the Nifty scales past 21,800, I am not looking at going aggressive long on the markets. If somebody had taken long positions in the morning, one can actually look at partial profit booking closer to about 21,800 because that is where time and again we are witnessing some kind of a supply pressure.

Once 21,800 is taken out decisively, it can happen in trade tomorrow. The gap area is between 21,900-22,000 and will get filled in tomorrow’s trading session.

But just ahead of that, what kind of trading strategies would you recommend for our viewers right now?

Aditya Agarwala: I have got a couple of buy recommendations. One has to be from the pharma space. The entire pharma space is buzzing and Dr Reddy’s is something I cannot miss out. Even though stock is up significantly in trade today as we speak, it is trading at day high. I still believe there is much more room on the upside left. So, one can go ahead, buy at current levels, look for a target of Rs 6,350 and nearly Rs 6,400 as well on the upside, with a stop loss closer to about Rs 5,950-6,000 on the downside, one can look at initiating fresh long positions in Dr Reddy’s even at current levels.

The second stock is Concor. Container Corporation has not been popping up. But if you take a look at the past two trading sessions, volume has been significant and today the stock has followed up with a good up move. So, it is a good time to look at the stock. Buy at current levels. It has broken out from a downward sloping channel for a target of Rs 935 on the upside, with a stop loss at Rs 840 on the downside, looks like a good bet.

I am not sure if you track some of these names, but PB Fintech is firing away in the trading session as is Godfrey Phillips. Maybe they are expecting some sort of positive outcome from the Budget tomorrow because there was a report this morning saying that for ITC specifically on the cigarette taxation front, it is going to be a non-event and Godfrey Phillips is up around 13% right now. Your take on Voltas, Policybazaar and Godfrey Phillips?

Aditya Agarwala: Let us talk about Godfrey Phillips first. There is definitely a sharp up move in the stock and it has broken out from a rounding bottom pattern and from there it has been heading higher one way. Even at current levels, I would strongly urge you to continue to hold on to the stock, looking for a target of at least Rs 3,000 on the upside.

I believe stock can test even higher levels from those. If you are looking for a fresh entry, maybe even at current levels you can look for a fresh entry with the stop loss at 2300 looks like a good bet. Talking about Voltas, this is something which I had recommended to our clients yesterday, so just a disclaimer there and even at current levels we are suggesting to hold on to the stock.

One can look for a target of at least Rs 1,150-1,160 on the upside and that happens to be the gap zone, so Voltas too can be held on and one is looking to enter… even at current levels they can do with the stop loss closer to 1070 on the downside. Talking of Policybazaar, that has been a steady up move, so if you already own the stock, maybe you can continue to hold it. At current levels, I would avoid fresh entry, but if you already hold the stock from previous levels, lower levels, continue to hold for a target of Rs 1,000 on the upside.

(You can now subscribe to our ETMarkets WhatsApp channel)

Related post