CG Power (₹229.3)
Hits record high
The stock of CG Power and Industrial Solutions, which was on a rally since August 2020, lost steam in early 2022 after reaching ₹200. Since then, it has been moving across the sideways band of ₹165 and ₹210. But last week it broke out, opening the door for further appreciation. Yet, there could be a corrective decline from here to ₹200, before the stock starts the next leg of uptrend.
That said, once the up-move begins, the scrip could rise to ₹260 within a year from now. Therefore, traders can go long at the current level of ₹229 and add more longs when price dips to ₹200 so that the average buy price would be ₹215. Keep stop-loss at ₹190. When it touches ₹250, revise the stop-loss up to ₹230. Exit all your longs at ₹260.
Dabur India (₹576.3)
Breaches a resistance
The stock of Dabur India, which was on a downtrend since September last year, reversed direction nearly a month agoback as it took support at ₹485. Last week, it broke out of the resistance band of ₹555-570, turning the near-term outlook positive. Although there could be a corrective decline to ₹555 from the current level, the stock is expected to appreciate to ₹625 and then possibly to ₹655 over the medium term.
Therefore, traders can buy the stock at the current level of ₹576 and accumulate more when price falls to ₹555. The average buy price would thus be ₹566. Place the stop-loss at ₹535. When the scrip appreciates to ₹600, modify stop-loss to ₹565. At ₹625, book profits on 60 per cent of total positions and then tighten the stop-loss to ₹595 for the rest. Liquidate the remaining positions at ₹655.
Eicher Motors (₹3,147.6)
Sees fresh breakout
The stock of Eicher Motors has been oscillating in the range of ₹2,320-3,000 since November 2020 and broke out last week. Since it has broken out after staying in the range for many months, the rally from here can be expected to be sharp. So, the stock will most likely rally past the prior high of ₹3,348 and touch ₹3,650 before the year-end.
While there could be a pause at ₹3,650, the scrip will eventually get over this hurdle and touch ₹4,000 before the end of next year. So long-term investors can buy the stock now and accumulate if price dips to ₹2,750. Place initial stop-loss at ₹2,480 and tighten it to ₹3,400 when stock touches ₹3,650. Alter stop-loss to ₹3,625 when price touches ₹3,800. Liquidate all the longs at ₹4,000.