Domestic benchmark indices opened Wednesday’s trade with losses while broader markets soared higher. After having soared higher from their March lows, Dalal Street equity indices have now entered a profit booking phase, according to analysts. However, the medium-term trend remains positive. “Key point to highlight is that over the past six sessions Nifty has rallied 1100 points. Thus, a couple of days breather from hereon can not be ruled out which would help index to cool off the overbought conditions and make the market healthy,” ICICI Direct said in a note. The brokerage firm has picked two stocks, amid this market structure that it believes will do well in the next three months.
Adani Ports and SEZ: BUY
Target price: Rs 915
Analysts said that the logistics space has been regaining upward momentum after a breather of nine months. Within this space, ICICI Direct said it remains constructive on Adani Ports as it logged a resolute breakout from the contracting triangle on the back of the above-average volume. “This signifies the conclusion of secondary correction that augurs well for a resumption of the structural uptrend. Hence, it offers a fresh entry opportunity with favourable risk-reward,” they added.
The stock is expected to rally to Rs 915 per share, which suggests an upside of 9% from Wednesday’s low of Rs 840 per share. Analysts have suggested a stop loss of Rs 775 per share for this trade with a time frame of three months.
Adani Ports and SEZ expects to reach 500 MT volumes by financial year 2025 on the back of strong double-digit volume growth in containers, liquid and bulk cargo, making it an attractive bet, said analysts.
Gujarat Pipavav Port: BUY
Target price: Rs 105
Another stock from the Logistics space, Gujarat Pipavav Port has been picked by analysts. The stock has been termed as lucrative based on chart observations that show the price resolved out of six months’ falling channel, indicating the conclusion of the corrective phase. Further, the stock has witnessed a faster retracement as it retraced past six week’s decline in just a single week, exhibiting structural turnaround that bodes well for extension of the ongoing up move, according to the brokerage firm.
The target price of Rs 105 apiece suggests an upside of 21% from today’s lows. A stop loss of Rs 82 per share has been suggested.
Fundamentally, Gujarat Pipavav Port is a South-West Gujarat based port with an MNC promoter. The port is backed by shipping behemoth Maersk which continues to see its fortunes grow with record ocean freight charges. Port extension and normalisation of Exim trade remain key triggers for the future performance of the stock.
