2 top stock recommendations from Sudeep Shah

"I feel we can see this consolidation going in for another day or two. And then we could see another leg up on the upside. So, overall what I feel is that 18530-18500 zone will now act as a strong support because we have seen some decent amount of put writing happening in 18500," says Sudeep Shah, SBI Securities.

Seems like a bit of a consolidation not high volumes, not great momentum at this point of time.
Yes, right. what we are noticing in the index today is that Nifty is trading in plus minus 20-25 points band and that is quite obvious and quite okay after such a big up move. Index is trying to consolidate at higher levels. Now, yesterday we have seen Bank Nifty also crossing and surpassing its previous lifetime high and it is now managing to sustain above that.

So I feel we can see this consolidation going in for another day or two. And then we could see another leg up on the upside. So, overall what I feel is that 18530-18500 zone will now act as a strong support because we have seen some decent amount of put writing happening in 18500.

So, 18500-18530 will act as a strong support on the upside. I feel that index could witness 18680-18700.

What would be your stock specific recommendations?
The first recommendation that I have today is Hindustan Aeronautics Limited, HAL. Now we have seen this stock since last seven-eight months, it is in a structural uptrend. There is an intermediate correction but those corrections are always bought into say around 13-day exponential moving average always acts as a support. This time also post that move to 3150 index HAL has retested this 2980-3000 mark which was its 13-day exponential moving average and post that once again we are seeing an uptick today.

Even BEL is showing some positive signs. So, I feel HAL from the current levels can be bought with Rs 3050 stop loss and Rs 3200 target.

Now, the second pick would be Dalmia Bharat. Now, we are seeing some momentum shift in cement stocks since last few days. And today, Dalmia Bharat has given a breakout of the downward-slopping channel that it was trading into since last 10 to 12 sessions.

And this breakout is backed with volumes and a rising open interest. So, I feel from the current levels this stock can be bought with Rs 2090 stop loss and a Rs 2180 target on the upside.


A couple of these counters which are buzzing in the trading session, JSW Energy on the upside and on the losing side Jubilant Pharmova what is happening there?
JSW Energy has been trying to make a bottom somewhere around 200-220 mark in the last two-three months. However, I feel that still the stock is not out of the woods, it is still in a downtrend and only across about 275-280 will mean that the short-term downtrend in the stock is over and then the stock can be bought on dips.

Because right now, even though we are seeing today it is up 4-4.5% but generally these rises are met with selling pressure at higher levels. And unless and until that 200 DMA, which is around 280 zone, does not cross, I do not think so that the stock will have any major upside. It might give us 3-5% moves here and there but structural uptrend, I feel would only come in place when it is above 280.

The second stock, which you said is Jubilant Pharmova. Now that stock is in a complete downtrend, selling pressure at higher levels is always witnessed. And I feel, till the time 363-370 does not cross on this stock, we might see the stock heading towards 283-290 levels in the next few weeks to come.

So, overall, the trend of the stock is negative and I feel we should not be doing bottom fishing in this stock. And if someone is holding it, rises should be used to exit and the money can be shifted into some other outperforming stock.