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I have bought the stock of Dr. Reddy’s Laboratories at ₹4,700. I wish to hold the stock at least for two years. What is the outlook?
Amit Kapoor
Dr. Reddy’s Laboratories (₹4,849.1) : The stock is broadly oscillating between ₹4,400 and ₹5,600 for more than a year now. On the charts, this broad sideways move looks to be a consolidation within the overall long-term uptrend. While this sideways range can continue to remain intact for some more months, the chances are high for the stock to break this range on the upside eventually. Immediate resistance above ₹5,600 is at ₹5,750-₹5,800. A strong rise past ₹5,800 will confirm the range break out and will indicate the beginning of a fresh leg of rally. Such a break can boost the bullish momentum and take the stock up to ₹6,900-₹7,000 over the long term. Immediate support below ₹4,400 is at ₹4,300. A dip to ₹4,400 from current levels cannot be ruled out. However, a break below ₹4,300 is less likely. Deeper support is at ₹3,800-₹3,700 which will come into play in case the stock breaks below ₹4,300.
I am holding 7,935 shares of M&M finance at an average price of ₹220. I am a long-term investor. Please advise me on adding more at current prices.
KVH Raghavendra Rao
Mahindra & Mahindra Financial Services (₹184.65) : The stock of Mahindra & Mahindra Financial Services is in an uptrend since April last year. After witnessing a correction between March and July this year, the stock has begun a fresh leg of upmove from August. There is a strong resistance in the ₹200-₹225 region. However, the broader view is bullish. Also, there is a possible inverted head and shoulder pattern formation visible on the charts. This is a bullish pattern. As such the chances are high for the stock to break ₹225. Such a break will confirm the pattern and take the stock up to ₹250-₹270 initially. From a long-term perspective, the uptrend that has been in place since April last year has the potential to target ₹320-₹350 on the upside. Supports are at ₹168 and ₹150. You can very well accumulate at current levels and also on dips near ₹170. You may have to have a stop-loss at ₹135.
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