Stocks to buy: Reliance, DMart, CG Power among 6 stocks that may rise 5-10% in the next 3-4 weeks, say analysts

Stocks to buy: After rising about half a per cent last week, Indian stock market benchmark Nifty 50 plunged 2 per cent in morning trade on Monday, November 4, amid an across-the-board selloff.

Market sentiment remained subdued as caution ahead of the US election 2024 and Federal Reserve policy decision added to concerns. Ongoing foreign capital outflows, weak corporate earnings, and stretched valuations have weighed on investor confidence.

Experts expect the market to remain on a bouncy track in the short term. They suggest a cautious approach to stock selection. Based on recommendations by two experts, here are six stocks that may rise 5-10 per cent in the next three to four weeks. Take a look:

Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers

Avenue Supermarts (DMart) | Previous close: ₹4,001.60 | Buying range: ₹3,990-4,010 | Target price: ₹4,400 | Stop loss: ₹3,800 | Upside potential: 10%

Over the past five weeks, DMart has faced substantial selling pressure, declining from a high of ₹5,484.85 to its current level around the ₹4,000 mark.

Recently, it found stability near this level after reaching an intraday low of ₹3,876 on October 31, 2024.

This ₹4,000 level aligns with a long-term, 1.5-year bullish trendline support visible on the weekly chart, which adds technical significance to this level as a potential area for price stabilisation.

The Relative Strength Index (RSI) has begun forming higher lows on the daily chart, signalling a possible reduction in selling pressure and hinting at exhaustion among sellers around this support zone.

Additionally, on the hourly chart, a hidden bullish divergence has emerged; while the price action made lower lows, the RSI did not follow, instead stabilising near its recent lows.

This divergence suggests that the downside momentum may weaken, creating a favourable buying opportunity around the ₹4,000 mark.

"We recommend entering a long position within the ₹3,990-4,010 range, targeting an upside move to ₹4,400. To manage risk, a stop loss should be placed at ₹3,800 on a daily closing basis, offering a sound balance between risk and reward," said Patel.

CG Power and Industrial Solutions | Previous close: ₹720.60 | Buying range: ₹715-725 | Target price: ₹790 | Stop loss: ₹685 | Upside potential: 10%

Recently, CG Power entered a corrective phase, leading to a healthy 175-point pullback, representing about a 20 per cent decline from its recent high.

This correction has brought the stock down to a crucial support level within a previous demand zone, an area where buyers have historically shown interest.

On the hourly chart, a bullish divergence has appeared, indicating a potential shift in momentum as selling pressure weakens.

Furthermore, the stock has broken above a prevailing bearish trendline, strengthening the case for a possible reversal.

This combination of bullish divergence and trendline violation makes the stock attractive at current levels.

"Based on these technical signals, we recommend going long in the ₹715-725 zone, with an upside target of ₹790. To manage risk, a stop loss should be placed at ₹685 on a daily closing basis, ensuring protection against downside movement if the support zone fails to hold," said Patel.

Bharat Dynamics | Previous close: ₹1,115.85 | Buying range: ₹1,085-1,120 | Target price: ₹1,220 | Stop loss: ₹1,020 | Upside potential: 9%

After hitting a peak of ₹1,794.70 in July 2024, Bharat Dynamics (BDL) has been in a corrective phase, consistently forming lower highs and lower lows.

This downtrend led to a significant correction, with the stock declining by about 800 points (around 44 per cent) from its high.

Currently, the stock is showing signs of stabilising as it approaches a previous demand zone—a level that historically attracted buyers.

Adding to this optimistic view, a bullish divergence has emerged on the daily chart, suggesting that bearish momentum may be waning, and a reversal could be on the horizon.

"We recommend initiating a long position in the range of ₹1,085-1,120. The target for this trade is set at ₹1,220, indicating a potential upside. However, to manage risk, a stop loss should be placed at ₹1,020 on a daily closing basis," Patel said.

Vishnu Kant Upadhyay, AVP of Research and Advisory at Master Capital Services

Reliance Industries | Previous close: ₹1,338.65 | Buying range: ₹1,320-1,330 | Target price: ₹1,420, ₹1,450 | Stop loss: ₹1,260 | Upside potential: 8%

Reliance's share price has experienced a healthy correction following its recent stock split, and it is currently trading near a significant horizontal support zone.

This level aligns with a successful retest of a long-term breakout level, suggesting a potential bullish reversal in the near term.

Further supporting this positive outlook, the price remains above the 100-week EMA (exponential moving average), adding confidence to the upward momentum.

"Investors might consider initiating long positions within the ₹1,320–1,330 range, aiming for target levels at ₹1,420 and ₹1,450. To manage risk effectively, a stop loss is advisable below ₹1,260, safeguarding against downside exposure while capitalising on the anticipated trend reversal," said Upadhyay.

GMR Airports Infrastructure | Previous close: ₹79.99 | Buying range: ₹76-78 | Target price: ₹81, ₹85.50 | Stop loss: ₹71.50 | Upside potential: 7%

GMRINFRA's share price recently underwent a correction of nearly 25 per cent from its all-time high; this week, prices witnessed a pullback from a support zone on the weekly chart.

This corrective phase, accompanied by declining trading volumes, indicates a limited downside move.

Additionally, the share price remains above the 100-week EMA, a historically reliable support level.

"Considering these technical indicators, investors may consider initiating long positions within the ₹76 to ₹78 price range, capitalizing on a favourable risk-reward opportunity. Upside targets are set at ₹81 and ₹85.5, with a recommended stop loss below ₹71.50 to effectively manage downside risk," said Upadhyay.

IPCA Laboratories | Previous close: ₹1,607.10 | Buying range: ₹1,560-1,580 | Target price: ₹1,640, ₹1,690 | Stop loss: ₹1,490 | Upside potential: 5%

IPCA Laboratories shares prices are traded on a bullish trendline, consistently forming higher highs and higher lows, with increased trading volume visible on the daily chart.

With prices above the key moving average of 34-week and 55-week EMAs, this upward structure signals a positive outlook and potential for continued gains.

"Investors may consider leveraging this bullish momentum by establishing long positions within the ₹1,560–1,580 range. The initial target is ₹1,640, with further upside potential to ₹1,690. To manage risk effectively, a stop loss is recommended below ₹1,490, protecting against downside exposure while positioning for gains aligned with the prevailing trend," said Upadhyay.

Read all market-related news here

Disclaimer: The views and recommendations above are those of individual analysts, experts, and brokerage firms, not Mint. We advise investors to consult certified experts before making any investment decisions.