Buy Avanti Feeds For 26% Gains In 1-3 Months: HDFC Securities

HDFC Securities in its report dated August 2 has recommended to buy the stock of Avanti Feeds. This is the brokerage's e-margin positional pick.

Buy Avanti Feeds For 26% Gains In 1-3 Months: HDFC Securities

About the stock:

Avanti Feeds is a small cap company with a market capitalisation of Rs. 6693 crore. The company is into manufacturing of prawn and fish feeds, and is a shrimp processor as well as exporter. Its major products are shrimp feed and processed shrimp.

Buying range, target and investment horizon:

The buy on the scrip of Avanti Feeds is suggested for 1-3 months. Buying range is given as Rs. 460-478. Targets given by the brokerage are 514/620. On the position if taken, the recommended stop loss is Rs. 430.

At the current market price of Rs. 492, potential investors in the stock can likely make up to 26% return in a short span.

Technical observations as per the Brokerage on the stock of Avanti Feeds

Avanti Feeds has recently corrected from an intermediate high of 639 tested in January 2022 and
found support at the 384 levels in May 2022, which also roughly coincides with previous intermediate
lows of the stock.

The stock has since then bounced back and made higher bottoms. It has also reversed its recent short
term downtrend in the process. A new uptrend was confirmed when the stock took out the previous
swing high of 462 on Monday on the back of above average volumes.

Technical indicators are giving positive signals as the stock is now trading above the 20 day and 50
day SMA. Weekly momentum indicators like the 14-week RSI have bounced back from oversold levels
and are in rising mode now.

With the intermediate technical setup too looking positive, the brokerage believes the stock has the potential tomove higher in the coming weeks and therefore recommend a buy.

Disclaimer: The stock recommended above is that by the brokerage. Readers should not construe the story as an investment advice into the stock and should engage in their own due-diligence before betting on such market-linked securities.

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