Stocks to buy: Here’s why Arvind Fashion and L&T Finance are a buy

Bank Nifty

Bank Nifty’s daily chart reveals an indecisive doji candle formation, signaling uncertainty in the Index. The index failed to close above its critical 200-day Simple Moving Average (SMA) at 43,200, implying strong resistance at this level. To consider a long position in Bank Nifty, it’s advisable to wait for a sustained breakthrough above the 200-day SMA, which could indicate a potential upward trend.

1) BUY L&T FINANCE HOLDINGS AT ₹140-136 | SL: ₹130 | TARGET: ₹150/152

RATIONALE: L&T Finance Holdings shows promising signs for potential investors. It has recently closed near a strong resistance level, signalling a potential breakout. Additionally, it’s trading above its 20-day moving average, confirming short-term bullish sentiment. Growing trading volume suggests increasing market interest. With an RSI at 61, indicating momentum strength, the stock appears well-positioned. Consider initiating a long position in the range of 136-140, setting a stop-loss at 130 for downside protection, and aiming for a target of 152.

2) BUY GODREJ CONSUMER PRODUCTS AT RS 1,020-1,000 | SL: RS 960 | TARGET: RS 1,100-1,170

RATIONALE: Godrej Consumer Products (GODREJCP) stock has shown a breakout from a falling trendline on the charts, supported by a sharp surge in trading volumes. The RSI momentum indicator has rebounded strongly from oversold territory, indicating renewed strength. Additionally, the stock has broken above its 200-day moving average (200DMA) positioned at 988, confirming a change in trend. With support visible at 960, acting as a cushion for the bulls, the stock presents potential upside targets in the range of 1,100 to 1,170.

3) BUY ARVIND FASHION AT RS 340 | SL: ₹300 | TARGET: ₹450/600

RATIONALE: Arvind Fashion stock has established a robust base formation at lower levels. It has been consolidating within a broad range between 265 and 380 and is currently displaying indications of an impending significant move in the near term. The stock continues to be in a “buy on dip” mode, with support at 300, and holds the potential for upside targets of 450 and 600.

The author, Kunal Shah is Senior Technical & Derivative analyst at LKP Securities

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decision

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Updated: 05 Nov 2023, 11:34 AM IST