Domestic stock markets remain volatile as multiple headwinds affect investor sentiment, not just on Dalal Street, but around the world. Amid higher uncertainty, analysts at ICICI Direct have selected two stocks from Futures and Options Universe based on their stock filtration model, expecting an upward trend. These include TVS Motors and Bharat Electronics Limited (BEL). On Thursday, the Sensex and Nifty started the day with weakness, down nearly 2% while India VIX rose 5%, again crossing 23 levels.
TVS Motor: Buy
Target Price: Rs. 748 per share
Stop Loss: Rs
Analysts point out that auto stocks have remained range-bound over the past few weeks, but that predicts a new up-and-down on the card. “Stocks like TVS Motors have returned to their support level of Rs 600. Price distribution also suggests a limited downward movement of the stock,” said ICICI Direct. Further, higher delivery-based measures have been noticed by analysts at TVS Motors which, in their view, suggest ongoing stockpiles at each level.
In terms of volatility, since January 2022, 30-day volatility has been low and despite recent market weakness, it still equates to 60-day volatility, indicating a stock range bound move. “Going forward, we expect the 30-day volatility to subside further from current levels, which could give new impetus,” said ICICI Direct while advising investors to buy the stock at Rs 632-645 per share over a three-month period. Thursday’s low indicates a 12% upward target.
Bharat Electronics Limited: Buy
Target price: Rs 260 per share
“Bharat Electronics (BEL) has been in a wide range for the last three to four months. However, the stock has outperformed its peers, ”said ICICI Direct. “Price distribution also suggests limited negative movement of stocks. Most readings for the stock are in the 0-2% range. We believe it will resume its upward bias after the ongoing merger, “they added.
Analysts point out that deliveries have been below average over the past few weeks, despite selling pressure, suggesting a weakening. It is recommended to buy at Rs 220-226 per share with a period of three months. The target price suggests a 14% uptrend from today’s low.