Stock in focus: Rajesh Palviya of Axis Securities recommends Hero MotoCorp, Crompton Greaves, and Ajanta Pharma today

Stock in focus: Rajesh Palviya of Axis Securities recommends Hero MotoCorp Ltd, Crompton Greaves Consumer Electricals Ltd, and Ajanta Pharma Ltd.

Stock Market News: Domestic equity benchmark indices, the Sensex and the Nifty 50, began Friday’s session in green amid positive global cues. Due to investor risk aversion during the ongoing election sessions, the domestic market saw heavy selling pressure on Thursday. However, because there aren’t any significant positive triggers, analysts predict that this volatility will continue in the near future.

The 30-share BSE Sensex opened higher by 71.28 points or 0.10% at 72,475.40 level while the Nifty 50 began at 21,990.95 level, up 33.50 points or 0.15%.

The chief investment strategist of Geojit Financial Services, Dr. V K Vijayakumar, noted that this month’s institutional activity disparity is getting more evident. Throughout all of this month’s trading days, FIIs have become persistent sellers and DIIs have become persistent buyers. Thus far this month, FII sales have totaled ₹22,858 crores, while DII purchases have totaled ₹16,700 crores. It seems that HNIs and retail investors have booked some profits and are in a wait-and-see mode, maybe in response to the noise and uncertainties around the election results, based on data indicating steeper falls in the overall market.

Further, Vijayakumar said that it’s crucial to realise that FIIs are selling because China and Hong Kong are outperforming India (the Shanghai Composite and Hang Seng have increased by 4.19% and 8.61%, respectively) while India is underperforming (the Nifty 50 has dropped by 3.5% in the past month). This is not due to election-related worries.

Share Market Tips and Nifty 50 Outlook by Rajesh Palviya, SVP – Technical and Derivatives Research, Axis Securities

Since the past five consecutive sessions, the index has experienced profit booking, forming a series of lower tops and bottoms indicating a negative bias. With the current close, the index is hovering around its six-month “up-sloping” trendline support zone at the 21,900 levels, a very crucial support zone. Hence, any violation of the same may cause further downside towards 21,700-21700 levels. This current “up-sloping” trendline support zone coincides with the 100-day SMA (21,981). On the other hand, 22,200–22,300 levels will remain as an immediate supply zone. The daily and weekly strength indicator RSI is in the negative terrain, signalling rising weakness, said Rajesh Palviya, SVP, Technical and Derivatives Research, Axis Securities.

The Nifty 50 in the current series has witnessed a short build-up with a price cut of 2.67% (603 points) and an increase in open interest by 17%. As per the options data of the weekly expiry scheduled on 16th May, 22,300 and 22,500 call strikes have high OI concentration, indicating a strong resistance, while on the put side, high open interest concentrations were at 21,500 and 21,800 acting as support, while the pivotal level will be 22,200, explained Palviya.

Stock in focus today – Stock recommendation for Friday by Rajesh Palviya

Hero MotoCorp Ltd (CMP: ₹4,761)

With the current close, the stock has decisively broken out its four monthly “down-sloping” channel breakout at 4,640 levels. This breakout, accompanied by huge volumes, indicates increased participation. The stock has recaptured its 20, 50, and 100-day SMA’s and rebounded sharply, indicating bullish sentiments. The daily, weekly, and monthly strength indicator RSI is in the positive terrain, justifying rising strength across all the time frames, said Rajesh.

Investors should buy, hold, and accumulate this stock with an expected upside of 5000-5250 and a downside support zone of 4,630-4,500, advised Palviya.

Hero MotoCorp today has seen price gains of almost 3.50% (157 points) in current expiry and an increase in open interest of 2% per the provisional data indicating a Long build-up. In the May series, there has been a high OI concentration at 4900 call strike followed by 5,000, showcasing a probable resistance zone, while strong support is at 4,500 and 4,600 levels as significant OI concentration on the Put side, explained Rajesh.

Crompton Greaves Consumer Electricals Ltd (CMP: ₹335)

On the daily chart, the stock has experienced a trend reversal as it has surpassed the past January 2024 swing high of 338 on a closing basis. The stock is placed well above its 20, 50, 100, and 200-day SMA, and these averages are also inching up along with the price rise, reconfirming a bullish trend. The daily and weekly strength indicator RSI is in positive terrain, signaling rising strength. The weekly Band Bollinger buy signal indicates increased momentum. Rising volumes at each rally signify increased participation, said Rajesh.

Investors should buy, hold, and accumulate this stock with an expected upside of 370–385 with a downside support zone of 328–316, advised Palviya.

Crompton Greaves has witnessed short covering with price gains of 9% (27 points) and a decrease in open interest of 24% (as per today’s provisional data). In the May series, there has been high OI unwinding witnessed at 340 call strike followed by 330, indicating a probable support zone, while the resistance is at 350 levels followed by 360 and 365, explained Rajesh.

Ajanta Pharma Ltd (CMP: ₹2,420)

The stock is in a strong uptrend across all the time frames, forming a series of higher tops and bottoms, indicating positive bias. On a weekly time frame, the stock has decisively broken out of the consolidation zone (2360-2000) on a closing basis accompanied by huge volumes. The stock is placed well above its 20, 50, 100, and 200-day SMA, and these averages are also inching up along with the price rise, reconfirming a bullish trend. The daily and weekly strength indicator RSI is in the positive terrain, signalling rising strength, said Rajesh.

Investors should buy, hold, and accumulate this stock with an expected upside of 2,585-2,630 with a downside support zone of 2,320-2,250, advised Palviya.

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