In the near term, do you expect the entire PSU basket to continue to outperform?
In terms of price movements, stocks like ONGC, GAIL and used to just stick around a level for months but now many such stocks are giving a breakout. PSU banks or power stocks that were languishing for a while have made a very good comeback. This space is buzzing very strongly.
Which stocks are on your radar this week?
I am bullish on the PSU theme. I have recommended many of these stocks earlier as well, but these stocks are looking very-very strong on the charts even from a near-term basis.
The first one which I would pick up is Coal India. After a big breakout recently, the stock looks very attractive for a continuation move on the upside. Coal India has confirmed some strong breakouts on multi-year charts as well as on the multi-month timeframe. Both the charts indicate that this could be the start of a new uptrend for Coal India. So I would suggest a positional buy on the stock with Rs 225 as a target. Keep a stop loss at Rs 175.
The second one would be a buy on Bank of Baroda. I believe many of these PSU bank stocks are showing signs of a very strong breakout. Bank of Baroda, on the short-term charts, has a given a bullish flag pattern breakout as well as inverse head and shoulder breakout. On the back of it, I am expecting an up move in Bank of Baroda as well over the next three to four weeks. Buy the stock with Rs 100 as a potential positional target and stop loss could be kept at Rs 74.
The third one is a buy on Canara Bank. The stock has given a breakout. SBI has been amongst the top candidates (in the PSU bank basket), but the second-rung performer has been Canara Bank. So I believe even this stock has the potential to go significantly higher from current levels. I would suggest a buy with Rs 210 as the target and stop loss at Rs 164.
