1 Mid Cap And 1 Small Cap Stock To ‘Buy’ By HDFC Securities For The Short Term

Updated: Saturday, September 25, 2021, 11:41 [IST]

Indian indices in trade on September 24, 2021 created record with Sensex hitting 60,000 levels and Nifty close to 18000 points at 17,948. Despite India being a very expensive market, investors seem to bet on the revival story. As per Bloomberg, the Nifty50 currently trades at a price-earnings (PE) multiple of 22.6 times its estimated one-year forward earnings.

Nonetheless, reputed brokerage firm HDFC Securities suggest a buy on a pharma and tiles company for gains up to 20 percent in the short term. Note these are positional calls by the brokerage firm:

Positional calls are suggested based on technical analysis of the stock the by brokerage's in-house research experts. The stock ideas are based on the market movements by examining historical data, like price and volume.

JB Chemicals and Pharmaceuticals-Buy for a target price of Rs. 2200

HDFC Securities is bullish on the counter of Mumbai based pharmaceuticals company that is engaged in the manufacture of pharmaceuticals formulations herbal remedies as well as APIs, JB Chemicals and Pharma. The brokerage has suggested to 'Buy' the scrip for gains of 19.8% and has set a target price of Rs. 2200 for the investment horizon of 3 months. Stop loss suggested for the trade is Rs. 1620.

Technical observations:

• Stock price has broken out from the downward sloping trendline on the daily chart with higher volumes.
• Stock price is forming bullish higher top higher bottom formation on the weekly chart.
• The counter is trading above its 5,20 and 50-day EMA and this shows short and medium term trend of the stock is positive.
• Oscillators including RSI and MFI is placed above 60 and rising upwards, which indicates strength in the current uptrend
• Plus, DI is trading above -DI while ADX line has started sloping upwards, indicating momentum in the current uptrend, adds the brokerage research report.

Stock	Last traded price	Target	Upside	Horizon
JB Chemicals and Pharmaceuticals	Rs. 1835.8	Rs. 2200	19.80%	3 months

Kajaria Ceramics:

For the short term of 3 months, brokerage house HDFC Securities recommends on buying Kajaria Ceramics scrip for a target price of Rs.1490, implying gains of 19.95% from the last traded price of Rs. 1242.15

Technical observations:

• The company's stock price has breached the earlier top resistance of Rs. 1229
• Stock price has been finding support on its 34 days EMA
• Primary trend of the stock is bullish with higher tops and higher bottoms
• On the weekly charts the stock has broken out from bullish "Flag" pattern.
• Price breakout is accompanied with jump in volumes.
• Stock has been holding levels above its medium to long term moving averages Indicators and oscillators have turned bullish on daily and weekly charts, adds the brokerage.

The ceramics and granite sector entity is the largest manufacturer of vitrified or ceramic tiles in the country. The company's annual aggregate capacity stands at 70.40 mn. sq. meters, which spans across eight plants located in different states including UP, AP, Gujarat and Rajasthan.

Stock	Last traded price	Target	Upside	Horizon

Kajaria Ceramics	Rs. 1242.15	Rs. 1490	19.95%	3	months

Disclaimer:

Investing in equities poses a risk of financial loss. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage houses are not liable for any losses caused as a result of decisions based on the article. The above article is for informational purposes only.

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