ICICI Securities, a domestic brokerage company, has revealed its Quant Pick report, recommending Coal India as its top stock pick to buy in a target range of Rs 190-194 with a target price of Rs 270 and a stop loss of Rs 171 in a three-month time frame. Apart from Coal India, Bharti Airtel, Navin Fluorine, Indusind Bank, Tata Motors, HDFC Life, and Granules have also received a buy call rating from the brokerage.
ICICI Securities has said "While the Nifty remained largely range bound, broader markets continued to move higher. Even in the Nifty, low weighted stocks from the metals & mining space are witnessing continued buying at every decline and fared better than index heavyweights. We believe the continuing participation from low weighted stocks should persist. We expect renewed buying in stocks like Coal India that has been consolidating for a couple of weeks after a sharp up move was seen in commodity prices."
The brokerage also highlighted that "The open interest in Coal India has been declining gradually in the last couple of months. It has come down to the lowest in the current series since June 2021 while the stock has been trading with a positive bias. We believe short positions are out of the system and fresh longs are likely to be seen from here onwards, which should lead to a swift further up move in the stock towards Rs 230 levels. On the options front, after significant writing in 190 Call, the highest Call OI base is at the 200 strike for the March and April series. However, closure is visible across Call strikes. With initial signs of closure among Call writers, we expect the stock to be well placed to surpass its Call base of Rs 200. On the other hand, writing was seen in 180, 175 Put strikes that should act as support on downsides."
From the initial days of the March series, the stock witnessed noteworthy delivery based activity near Rs 170-180 levels. Since then, it has been trading with a positive bias above Rs 170. We believe this accumulation will maintain positive momentum in the stock above said levels. The delivery Z-Score has again started to move into the positive territory since March 2022 as the stock is witnessing fresh accumulation in the delivery segment," ICICI Securities has further noted.
Quant Picks: Open recommendations By ICICI Securities
|Stocks||Action||Recommendation Price In Rs||Target price in Rs||Stop Loss In Rs||Time Frame|
|Bharti Airtel||BUY||700-717||815||649||3 months|
|Navin Fluorine||BUY||3950-3985||4625||3610||3 months|
|Indusind Bank||BUY||905-925||1078||830||3 months|
|Tata Motors||BUY||428-438||515||389||3 months|
|HDFC Life||BUY||518-528||598||476||3 months|
|Coal India||BUY||190-194||230||171||3 months|
|Source: ICICI Securities. Data as of March 28, 2022|