The Sensex ended 558.72 points lower at 83,674.92, while the Nifty slipped 146.65 points to settle at 25,807.20, briefly breaching the 25,750 mark during the session.
Three stocks to trade, recommended by NeoTrader’s Raja Venkatraman:
CHEMPLAST (cmp ₹333.90)
- Why it’s recommended: Chemplast Sanmar Ltd. is a leading Indian specialty chemical manufacturer, part of the Sanmar Group, known for PVC resins, custom-manufactured chemicals for pharma/agrochemicals, caustic soda, chlorochemicals, and hydrogen peroxide, with key facilities in southern India. The sharp declines seen since last few months have been laid to rest and a revival post consolidation is indicating a strong recovery. On the daily charts we also found a range breakout getting formed leading to a sustained revival. With a push beyond the cloud region and a strong upside has emerged in the previous trading sessions. Buy.
- Key metrics:
- 52-week high: ₹490.60
- Volume: 699.72K
- Technical analysis: Support at ₹290, resistance at ₹400.
- Risk factors: High debt, volatile raw material costs (due to heavy imports), foreign exchange fluctuations, intense competition in the commodity PVC market, seasonal demand swings.
- Buy: above ₹334.
- Stop loss: ₹311.
- Target price: ₹380. (2 Months)
BEL (Cmp ₹443.90)
- Why it’s recommended: Bharat Electronics Ltd (BEL) is a state-owned “Navratna” specializing in high-tech electronic products for the Indian Armed Forces, but has diversified into non-defense sectors like smart cities, e-governance, cyber security, medical electronics, and space. The recent highs are not giving up and recent dips that are emerging on intraday timeframe is producing a rebound to a strong upward traction. A bullish Kumo crossover suggests that we could see if strong upmove if the recent price resistance around 1030 is held suggesting that we can consider going long now.
- Key metrics:
- P/E: 54.53,
- 52-week high: ₹461.40,
- Volume: 16.14M.
- Technical analysis: Support at ₹420, resistance at ₹510.
- Risk factors: Heavy dependence on the Indian government for orders and the inherent volatility of the defense sector.
- Buy: above ₹445
- Stop loss: ₹428
- Target price: ₹485 (2 Months)
KIMS (cmp ₹697.80)
KIMS: buy above ₹700, stop ₹665 target ₹780 (Multiday)
Why it’s recommended: Krishna Institute of Medical Sciences Ltd (KIMS) is a major Indian corporate healthcare group, operating numerous multi-specialty, known for its scale, technological adoption (like robotic surgery), and accessible healthcare services with a large bed capacity. KIMS after a sharp drawdown reported a surprise Q3 revenue. The declines since last few weeks seems to be bottoming out to produce a sharp breakout above cloud region with volumes. Go long.
- Key metrics:
- P/E Ratio: 96.32
- 52-week high: ₹798
- Volume: 1.23M
- Technical analysis: Support at ₹645, resistance at ₹800.
- Risk factors: Debt-funded capex or acquisitions, high attrition rate of doctors.
- Buy: above ₹700.
- Stop loss: ₹665.
- Target price: ₹780.
Stock Market Recap
On 12 February, Indian Equity markets closed lower, snapping a four-day winning streak as persistent weakness in IT stocks weighed on sentiment. Concerns over the impact of artificial intelligence on the sector continued to pressure technology counters, with the Nifty IT index sliding to a 10‑month low after extending its recent decline. Having already fallen 7% last week, IT stocks shed another 6% so far this week, dragging broader benchmarks into the red.
The Sensex ended 558.72 points lower at 83,674.92, while the Nifty slipped 146.65 points to settle at 25,807.20, briefly breaching the 25,750 mark during the session. Broader indices mirrored the weakness, with the Nifty Midcap and Smallcap indices each losing 0.5%. Market sentiment remained cautious as investors weighed sectoral headwinds against recent gains, signaling a near‑term consolidation phase after the rally seen earlier in February.
Outlook for Trading
After a steady upward traction, the market gave away the gains accrued to put us on a tenterhook. Currently, as we have been mentioning, the market has remained stressed at higher levels around 26000. Despite limited encouraging triggers, we can note that the market is seeking out newsflow to move confidently higher.
The lack of participation at higher levels clearly demonstrated a quick dissipation of trends. At the moment the constant geopolitical tensions that have been emanating this year leading to possibility of continued volatility is very much on the cards.
As can be seen on the charts we can see that the gap region has now closed in. The gap supports have been critical and a move below 25700 could trigger a negative reaction. With a sharp drop beneath this region, we can expect the bearishness to retain its grip.
However, we observe that the range is getting tighter and the readings from the Option Data suggest that PCR has moved to 0.61 once again, highlighting that the trends are now at a deep oversold region. With notable Call writing seen at 26000 and higher we are now at an important point for the days ahead as lower levels remain open.
Despite the best intentions, the market is unable to conjure up enough strength to continue its upward march. The gap formed at the start of the day on Thursday has been filled. Now, some support and tailwind is needed to contain the damage done.
Overall view continues to advocate an attempt to buy on every dips. At the moment, the bias has once again given people a reason to hold on to the bullish side of the markets for now, despite the strong reaction seen in domestic markets. With limited clarity on the future course of action, we should be looking at participating with a bullish bias.
Trends continue to remain two-phased and require us to balance either sides of the trend. Hence, the situation demands a pragmatic approach to benefit from market participation. We can observe that the RSI is struggling to cross the 60 levels, which clearly spells some danger ahead.
With the results season continuing to emit mixed responses and driving up the volatility, we need to see how to navigate the current trends. While market continues to offer umpteen opportunities sector rotation will be at work and hence, we have selected candidates that are displaying steady action from both sides until new signals to the contrary emerge.
Raja Venkatraman is co-founder, NeoTrader. His SEBI-registered research analyst registration no. isINH000016223.
Investments in securities are subject to market risks. Read all the related documents carefully before investing. Registration granted by SEBI and certification from NISM in no way guarantees performance of the intermediary or provide any assurance of returns to investors.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.
