Cadila, Hero Moto, Sun Pharma, HCL Tech among 12 stocks that can deliver gains in 2-3 weeks

NEW DELHI: Equity benchmarks Sensex and Nifty started with decent gains on Monday, supported by a rise in shares of select heavyweights, including Infosys, Sun Pharma, Kotak Mahindra Bank, HDFC twins and TCS.

Investor sentiment got a leg up after IT major Infosys last Friday raised its guidance for FY20 despite concerns over a slowdown in IT sector growth.

Chinese data this morning suggested the world’s second-biggest economy may be starting to stabilise thanks to ramped-up stimulus from Beijing, which assuaged concerns of a global economic slowdown.

China's second-quarter annual GDP growth rate fell to a 27-year low of 6.2 per cent as expected, but its quarterly growth reading of 1.6 per cent was ahead of forecasts and June reports on industrial production, retail sales and urban investment were also well above expectations, Reuters reported.

While the market traded in the green, analysts said it is too early to say if the gains will sustain. They advised stock-specific positioning to maximise gains and minimise losses.

Based on the recommendations of various analysts and brokerages, here is a list of 12 stocks that they say can potentially deliver gains over the next 2-3 weeks.

Vikas Jain, Senior Research Analyst, Reliance Securities

Cadila Healthcare | Buy | Target price: Rs 255 | Stop loss: Rs 215

This stock has seen a sharp fall over the past 13 weeks from the high of Rs 353 and the cycle of the correction is likely to be completed. The stock has completed its 76.4 per cent retracement of the entire movement (Rs 127-560) near sub-Rs 230 and is expected to bounce back. Positive cross-over in RSI and a rise in Stochastic from its oversold zone are indicating a probable turnaround in the stock.

India Cements | Buy | Target price: Rs 108 | Stop loss: Rs 89

This stock has formed a double bottom near Rs 90 on the weekly charts and is trading higher above the short-term averages. Major technical indicators on the weekly scale have bottomed out, signalling a near-term turnaround in the stock. “In case of any decline, the bottom at Rs 90 will continue to work as the key reversal point for the stock,” Jain said.

Mustafa Nadeem, CEO, Epic Research

United Breweries | Buy | Target price: Rs 1,480-1,520 | Stop loss: Rs 1,335

This stock is in a long-term uptrend while in the short term it has seen sideways to corrective movement. It has taken very strong support at the 50-day, 100-day and 200-day SMAs. With that, it coincides with long-term support trendline drawn from the troughs of Q417. “We believe this dip should be utilised to create a long position for targets of Rs 1,480-1,520 with a stop loss of Rs 1,335,” said Nadeem.

Manappuram Finance | Buy | Target price: Rs 150 | Stop loss: Rs 120

This stock has been making a higher top and higher bottom. Recently, it has seen a strong bullish breakout, breaching and sustaining above its previous all-time highs. It is now supported by 50 and 100 days moving averages, placed in the zone of Rs 124-129. “We believe this can be a short-term bottom and prices can continue to move in its uptrend to move towards a new all-time high of Rs 150,” Nadeem said.

Rajesh Bhosale, Technical Analyst, Angel Broking

Apollo Hospitals Enterprise | Buy | Target price: Rs 1,490 | Stop loss: Rs 1,290

After the sharp rally, seen during May and June from Rs 1,112 to Rs 1,406 levels, this stock has seen consolidation in July. On the daily chart, after consolidating on 38.2 per cent retracement level of the above-mentioned rally, the stock seems to have resumed the uptrend by confirming a descending triangle breakout on the line chart. The said breakout is supported with a good increase in volume and positive placement of major moving averages (50SMA and 200SMA). In addition, momentum oscillator RSI, after forming a base around 50 levels, is signalling a fresh buy with its smoothened average.

Intellect Design Arena | Buy | Target price: Rs 315 | Stop loss: Rs 262

This stock has been an outperformer, continuously moving in a ‘higher top-higher bottom’ bullish price cycle formation. On the daily chart, after consolidating for a month around its all-time high level, the stock has resumed the uptrend by breaking above of its previous swing high. The said breakout is witnessed with a good increase in volume and strong bullish candle. In addition, prices have closed above the higher range of Bollinger band, which suggests a strong trending rise in the near term, post its recent consolidation. "The prices are trading in unchartered territory and are well above major moving averages," said Bhosale.


Kkunal Parar, Senior Technical Research Analyst, Choice Broking

Century Textiles & Industries | Buy | Target price: Rs 980 | Stop loss: Rs 890

On the daily chart, the stock has formed a Bullish Harami Candlestick formation which is an indication of a bullish reversal. Moreover, the stock has taken support at its horizontal trend line, which suggests a bounceback on the counter. The stock has taken the support at its 200-day moving average and has given a breakout of its three days trading range which shows a northward movement in the counter. Daily momentum indicator RSI reading is at 45.35 level with a positive crossover, which points out to a positive breath in the counter.

Biocon | Buy | Target price: Rs 272.80 | Stop loss: Rs 244

On the daily chart, the stock has given a breakout from its upper band of falling wedge formation which is a bullish reversal indication. Moreover, the stock has been trading above its 21-days moving average placed at 248.55 which shows a positive rhythm in the counter for the time being. After a healthy correction, the stock has formed an Opening Marubozu candlestick which is a bullish reversal candlestick and suggests a northward movement in the counter. Daily momentum indicator, RSI, is at 49.75 level with a positive crossover. Apart from this, the stock has formed a positive divergence which points out to a positive breath in the counter.

Aditya Agarwala, Senior Manager, Technical Analysis, YES Securities

HCL Technologies | Buy | Target price: Rs 1,075-1,120 | Stop loss: Rs 995

On the daily chart, HCL Technologies has turned higher after taking support at the lower end of the wedge pattern indicating bullishness. Further, the stock has completed a bullish AB=CD corrective pattern. Potential reversal zone (PRZ) of the pattern also happens to be the lower end of the wedge pattern placed at Rs 1,005. The RSI has also turned upwards after testing the oversold zone on the daily chart, suggesting bullishness building up in the stock.

Bharat Forge | Buy | Target price: Rs 495-510 | Stop loss: Rs 437

On the daily chart, Bharat Forge is on the verge of a breakout from a bullish wedge pattern, suggesting bullishness building up in the stock. Sustained trade above Rs 475 will trigger a breakout from the pattern which can take it higher to Rs 495-510 levels. On the weekly chart, it is constantly taking support at Rs 430 which also happens to be the 78.6 per cent Fibonacci retracement level. A sustained trade above Rs 475 will take the stock higher. The RSI has formed a positive divergence and turned north, indicating bullishness in the stock.

Vaishali Parekh, senior technical analyst at Prabhudas Lilladher

Hero MotoCorp | Buy | Target price: Rs 2,800 | Stop loss: Rs 2,400

This stock has witnessed a decent erosion recently and has bottomed out near Rs 2,360 level to give a bounce back. The RSI shows a trend reversal has improved the bias. “The chart looks attractive and we anticipate the stock to rise further from here on in the coming days. With good volume participation witnessed, we recommend a buy in this stock for an upside target of Rs 2,800, keeping a stop loss of Rs 2,400,” Parekh said.

Sun Pharma | Buy | Target price: Rs 445 | Stop loss: Rs 380

This stock recently formed a double-bottom pattern near Rs 365 and recovered strongly to give almost a breakout above the previous peak level of Rs 408. The RSI has recovered strongly from the oversold zone and also indicated a trend reversal to signal a buy. With the stock moving above the 50-DMA moving average, the bias has improved significantly and a further upward move from these levels is expected. "With good volume participation witnessed, we recommend a buy in this stock for an upside target of Rs 445, keeping a stop loss at Rs 380,” said Parekh.

(Views and recommendations given in this section are the analysts’ own and do not represent those of ETMarkets.com. Please consult your financial adviser before taking any position in the stock/s mentioned.)

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