Buy or sell: Sumeet Bagadia recommends three stocks to buy on Monday — 27 January 2025 | Stock Market News

Buy or sell stocks: Downside momentum continued in the Indian stock market on Friday after a slight upside bounce on two previous sessions. The Nifty 50 index finished 114 points lower at the 23,090 mark, the BSE Sensex went down 329 points and closed at 76,190, whereas the Bank Nifty Index ended 232 points lower at 48,356. After Thursday’s pullback rally, the Mid-cap and the Small-cap indices resumed their downward journey. The Nifty Mid-cap 100 plunged by 1.55%, while the Nifty Small-cap 100 plummeted 2.35%. This sharp fall in the mid and small-cap space was further reflected in the advance-decline ratio, which stood at 0.36 levels on the BSE, the lowest since 13 January. For January, the Nifty Small-cap Index is down by 9.5% against a 2.35% fall in the Nifty.

The Nifty IT index emerged as the best-performing sector for the third straight session, led by gains in stocks like Mphasis, Wipro, and Persistent Systems. Reliance Industries Ltd. contributed the most to the index decline, decreasing 1.4%. Dr Reddy’s Laboratories Ltd. had the most significant drop, falling 5.0%. Among the sectoral Indices, Nifty Reality, Oil & Gas, Healthcare, and Pharma were significant losers, while Nifty IT and FMCG were the only sectors to end in the green.

Sumeet Bagadia’s stock recommendations for Monday

Sumeet Bagadia, Executive Director at Choice Broking, believes the Indian stock market bias is cautious as the Nifty 50 index is trading in a small 22,900 to 23,300 range. The Choice Broking expert said the 50-stock index failed to break above the 23,300 hurdle decisively and succumbed to profit-booking pressure. However, the key benchmark index managed to sustain above the 23,000 mark. Sumeet Bagadia said the Nifty 50 index may try to test the 22,750 to 22,700 level on breaching below 23,000 on a closing basis. On the upper side, for improvement in Dalal Street sentiments, the Nifty 50 index must break above 23,350 on a closing basis, said Bagadia. He advised investors to maintain a stock-specific approach and look at those stocks that look strong on the technical chart pattern.

Regarding stocks to buy on Monday, Sumeet Bagadia recommended buying these three shares: Hindustan Unilever or HUL, Eicher Motors, and ACC.

Buy or sell stocks: Sumeet Bagadia’s stock picks

1] HUL: Buy at ₹2368.10, target ₹2600, stop loss ₹2250.

HUL share price is currently trading at ₹2368.10, consolidating near key support zones. The stock recently experienced sharp selling but has since stabilized, indicating the formation of a potential base. The consolidation near support levels suggests that selling pressure may be subsiding, paving the way for a possible recovery.

HUL’s share price has bounced notably from lower levels, signalling the possibility of a reversal. This positive movement has been accompanied by follow-through buying in the latest session, with the daily chart forming a strong bullish candle supported by increased trading volumes. This indicates renewed buying interest and strengthens the case for further upward momentum.

If the HUL share manages to sustain above the crucial resistance level of ₹2425, it could unlock the potential for a strong upside move, targeting ₹2600 in the medium term. The Relative Strength Index (RSI) is currently at 48.32 and showing signs of a reversal from lower levels. A positive crossover in the RSI would further reinforce the bullish outlook, signalling strengthening momentum.

The stock is trading near its short-term Exponential Moving Average (EMA), and a breakout above the medium- and long-term EMAs would confirm the continuation of the upward trend. Buying at the current level of ₹2368.10 offers a good risk-reward opportunity, with a stop-loss placed at ₹2250 for an upside target of ₹2600. Investors and traders should watch for sustained trading above ₹2425, which would serve as a key confirmation level for further bullish movement.

2] Eicher Motors: Buy at ₹5206.30, target ₹5700, stop loss ₹4950.

Eicher Motors share is currently trading at ₹5206.30, showing a strong reversal from the demand zone after witnessing sharp selling from its recent high of ₹5385.70. Eicher Motors’ share price movement indicates that the demand zone has provided significant support, preventing further downside and enabling recovery. This reversal suggests a renewed interest in the stock at lower levels, highlighting its potential for additional upside.

Following the consolidation near the demand zone, Eicher Motors’ share has given a breakout from its range, which is a bullish signal. The stock’s ability to sustain above the immediate resistance level of ₹5250 will be crucial for continuing its upward momentum. If it manages to hold above this level, it could move towards the higher target of ₹5700, with ₹5400 as a key hurdle.

The Relative Strength Index (RSI) is currently at 62.23 and trending upwards with a positive crossover, indicating strengthening bullish momentum. This upward trajectory in RSI aligns with the stock’s breakout, reinforcing the likelihood of an extended rally. The stock has recently bounced back above its short-term and medium-term Exponential Moving Averages (EMAs), signalling a positive trend shift.

At the current price of ₹5206.30, Eicher Motors shares offer a promising buying opportunity with a favourable risk-to-reward ratio. To manage downside risk, a stop-loss should be set at ₹4950, while the upside target remains at ₹5700. Traders and investors should monitor the stock’s ability to sustain above ₹5250, as this will confirm the breakout and signal further strength in the stock’s price movement.

3] ACC: Buy at ₹2058.95, target ₹2270, stop loss ₹1955.

ACC’s share price currently trades at ₹2058.95 after recently experiencing a downside move characterized by lower highs and lower lows. The stock has found support at lower levels, indicating that selling pressure is easing. It is now showing signs of a potential reversal, which could mark the beginning of a recovery phase.

ACC share price is on the verge of breaking out of the falling trendline, a key technical resistance. A sustainable breakout above the ₹2100 level would confirm this reversal and drive the stock toward its short-term target of ₹2270. Furthermore, if ACC sustains above ₹2270, it would signal a reversal in the overall trend, opening the door for more significant upside potential.

The Relative Strength Index (RSI) is at 52.02 and trending upward, suggesting improving momentum and strength in the stock’s price action. Additionally, ACC’s share price has bounced from lower levels and has surpassed its short-term Exponential Moving Average (EMA). However, a sustainable breakout above its medium-term EMA is essential to establish further bullish momentum, which could propel the stock toward testing its long-term EMA.

At the current price of ₹2058.95, ACC share presents an attractive buying opportunity for traders and investors, with a stop-loss set at ₹1955 to manage risk. The stock’s ability to sustain above ₹2100 will be critical for confirming the breakout, while a move above ₹2270 would reinforce the bullish outlook, signalling a potential trend reversal and further upside in the coming sessions.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.