Buy or sell: Sumeet Bagadia recommends three stocks to buy on Monday — 3 March 2025

Buy or sell stocks: After going sideways to negative for seven straight sessions, the Indian stock market witnessed a bloodbath during the Friday session. The Nifty 50 index crashed 420 points or 1.86 per cent — the steepest single-session decline since October 3, 2024, in percentage terms — and closed at 22,124. The BSE Sensex nosedived over 1400 points and closed at 73,198, while the Bank Nifty index tanked 399 points and finished at 48,344. Selling in the broad market was more extensive as the BSE Small-cap index crashed over 2.30 per cent, while the Mid-cap index nosedived over 2.15 per cent.

Sumeet Bagadia’s stock recommendations

Sumeet Bagadia, Executive Director at Choice Broking, believes that Indian stock market sentiment weakened after the Dalal Street bloodbath. The Choice Broking expert said the Nifty 50 index has broken the crucial support placed at 22,200, and the 50-stock index may now try to test the 21,800 range in the near term. He advised stock market investors to look at those stocks that look strong on the technical chart and suggested buying these three shares: Shriram Finance, IndiGo, and HDFC Bank.

1] Shriram Finance: Buy at ₹617, target ₹653 to ₹670, stop loss ₹595.

Shriram Finance’s share price is trading at ₹617, having recently rebounded from a key support zone. The stock has formed a bullish candlestick on the weekly timeframe and has successfully broken out of a falling trendline. This breakout strengthens the reversal pattern, suggesting renewed buying interest from market participants. The stock has notably recovered nearly 21% from its recent decline, further reinforcing the bullish sentiment.

From a technical standpoint, Exponential Moving Averages (EMAs) confirm a strong uptrend, as the stock is currently trading above its 20-day, 50-day, and 200-day EMAs. This alignment of moving averages indicates sustained buying pressure and suggests that the stock is well-positioned for further gains. If Shriram Finance’s share price breaks above the immediate resistance level at ₹620, it could extend its upward move towards a short-term target of ₹653.

Additionally, momentum indicators such as the Relative Strength Index (RSI) support this bullish outlook. The RSI currently stands at 67.36 and is trending upwards, reflecting increasing buying momentum and market strength. On the downside, immediate support is positioned at ₹595, a key level to watch in case of any pullback.

Considering the prevailing technical setup and market conditions, initiating a long position at ₹617 is a strategic move. A well-defined target range of ₹653 to ₹670 offers a favourable risk-reward ratio. Placing a stop-loss at ₹595 would be a prudent risk management strategy to manage potential downside risks effectively. This approach ensures that any unexpected price reversal is contained while allowing maximum upside potential.

2] IndiGo: Buy at ₹4477, target ₹4760, stop loss ₹4350.

IndiGo share price is currently trading at ₹4477, having recently surged from the 200-day EMA support level. Additionally, the 20-day EMA has crossed above the 50-day EMA, signalling a continuation of the bullish trend. The stock trades comfortably above these key moving averages, reinforcing positive momentum and indicating strong buying interest. However, the stock faces resistance at a falling trendline and is on the verge of breaking out. A successful breakout would confirm a reversal pattern, supported by rising trading volumes, further strengthening the bullish outlook. This breakout could attract more buyers, leading to a potential price surge.

A decisive move above the critical resistance level of ₹4575 would confirm the breakout, providing an ideal entry point for long positions. If this level is breached, the stock has the potential to rally toward an upside target of ₹4760, further reinforcing positive sentiment.

Given the current technical setup, traders may consider entering a long position at ₹4477, with a stop-loss placed around the 20-day EMA, currently near ₹4350, to manage risk effectively. While the trade setup appears favourable, it is crucial to remain mindful of short-term volatility and adhere to strict risk management strategies. Ensuring disciplined execution will help maximize potential gains while mitigating downside risks.

3] HDFC Bank: Buy at ₹1732, target ₹1800, stop loss ₹1670.

HDFC Bank share is trading at ₹1732, exhibiting strong bullish momentum over the past three sessions. The stock has rebounded from its recent decline and has shown a promising sign of recovery by forming a strong bullish candlestick on the daily timeframe. This reversal is further supported by increasing trading volumes, indicating strong investors’ buying interest and reinforcing the stock’s positive sentiment.

From a technical perspective, Exponential Moving Averages (EMAs) confirm a strong uptrend, with the stock trading comfortably above its 20-day, 50-day, and 200-day EMAs. Additionally, the price has taken solid support from short-term EMAs, further strengthening the bullish outlook. If HDFC Bank’s share price successfully breaks above the immediate resistance level at ₹1740, it could extend its rally toward the short-term target of ₹1800. Momentum indicators also support the bullish stance, with the Relative Strength Index (RSI) currently at 57.25 and trending upward, reflecting increasing buying pressure. On the downside, immediate support is positioned at ₹1715, which could be a cushion against minor pullbacks.

Considering the prevailing technical setup and market conditions, initiating a long position at ₹1732 is well-calculated. With a defined target of ₹1800, the trade offers a favourable risk-reward ratio. Setting a stop-loss at ₹1670 would be a prudent risk management approach to manage downside risks effectively, ensuring that any unexpected price reversal is contained while maximizing potential gains.

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.