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1 Large Cap And 1 Small Cap Stock To Buy For Double Digit Returns In 3 Months
Indian markets given the uncertainty in the pace of future rate hikes are trading on a weak note. Nifty at the time of writing this copy at around 11:10 am has given up 17,900 levels, while Sensex too is subdued and holding levels of 60,000.Amid such a backdrop, HDFC Securities has recommended a 'Buy' on 1 large cap stock i.e. ICICI Prudential and 1 small cap telecom services related scrip Sterlite Technologies for good double-digit gains in 3 months. Here's in detail about the two stocks together with the technical observation on each of them.
ICICI Prudential-Buy for a target price of Rs.697 in 3 months
The brokerage has set out a target of Rs. 697 on the large cap insurer seen to be realised in 3 months time. The suggested stop loss is Rs. 545. considering the last traded price of Rs. 589.05, the stock can likely provide returns to the tune of over 18%.
Technical observation on ICICI Prudential
ICICI Prudential scrip has corrected from a high of 724 touched in September 2021.
The stock recently found support at the 430 levels where it made a double bottom and has strongly bounced back from these levels in the last few months.
On Thursday, the stock broke out of the 540-580 range on the back of healthy volumes, indicating the
stock is set to continue its short term uptrend.
Weekly momentum readings like the 14-week RSI are in rising mode and not overbought, which is encouraging.
"With the intermediate technical setup too looking positive, we believe the stock has the potential to
move higher in the coming weeks and therefore recommend a buy", mentions the brokerage.
About ICICI Prudential
The company is a joint venture between ICICI Bank Limited and Prudential Corporation Holdings Limited. It provides life insurance, pensions and health insurance to individuals and groups.
Sterlite Technologies: Buy for a target price of Rs. 188
For the telecom entity, HDFC Securities has given a 'Buy' call for 3 months for a target price of Rs. 188. At the current market price of Rs. 161, investors in the stock can potentially earn up to 16.77% return. Stop loss recommended against the trade is Rs. 140.5 per share.
Technical observation
The brokerage has given this recommendation as its technical positional pick.
The stock price was in an intermediate down trend in the previous many months and the
recent swing low formation at Rs 128.60 of 12th June could now be considered as an
important bottom reversal pattern.
The stock price is now in an attempt to stage upside breakout of the range movement as
well as the resistance as per the concept of change in polarity at Rs 157 levels.
The upside breakout of Rs 157 could open up a sharp upside bounce towards the formation
of larger degree lower top formation.
The weekly RSI shows positive indication for the stock price ahead.
The overall chart pattern of Sterlite indicates long trading opportunity.
About Sterlite Technologies
Sterlite Technologies Limited is primarily engaged in the business of telecom products and solutions. The company offers its products and solutions under the brand Sterlite Tech. The company's peers include HFCL, ITI, Vindhya Telelinks, Tejas Networks among others.
Disclaimer
The stocks recommended in the story are taken from the brokerage report. Readers should not construe the story as an investment advice into these stocks.
