Stock selection for 2024 general elections: IRCTC, SBI ranked among top 10 stocks this season. Offers 10-20% upside potential

2024 General Election Stocks: Lok Sabha elections act as one of the key triggers that has a significant impact on market volatility based on corporate announcements, sentiment changes, and pre-poll results. This year’s general elections are drawing attention due to India’s importance in geopolitics, its position in emerging markets, and Prime Minister Narendra Modi’s bid to form a third consecutive term in power.

According to domestic brokerage firm Shriram Way to Wealth, the reason for the post-election stock market movement is the fact that investors expect the strong capital investment momentum to continue under Prime Minister Modi’s government. “This has boosted investor sentiment and could continue the rally in the PSU sector on the back of the re-ratings and policy continuation seen in the past,” the brokerage said in a note.

Also read: SBI, M&M, Axis Bank to LT: Motilal Oswal recommends 14 stocks to buy after Bharatiya Janata Party wins assembly elections

Injecting liquidity into the rural economy will be an important catalyst to stimulate rural consumption demand, which has been missing in recent quarters due to a below-average monsoon, the effects of El Niño, suppressed agricultural prices and rising inflation. . As a result, regionally focused companies such as FMCG, tractor and agricultural machinery makers may remain on investors’ watch list, the brokerage said.

Another important sector to watch is the agrochemical sector, which could react positively if the government announces a large fertilizer subsidy given its large agro-based vote bank before the elections. there is.

In the current market scenario, Shriram Way2Wealth has announced the top 10 stocks for this election season ahead of the 2024 general elections. Brokers select blue-chip stocks based on technical and fundamental parameters. The brokerage firm believes the following 10 stocks have the potential to rise 10-20% over the medium to long term.

Stock selection for the 2024 general election:

Let’s take a look at the top 10 stocks selected by securities firm Shriram Way2Wealth for the 2024 general election.

1.Bharat Electronics Ltd. (BEL): Current market price (CMP): INR185.90; Goal: INR215; Likelihood of increase: 14%

BEL is currently trading near all-time highs and is showing strong momentum. The stock has broken out of the bullish rectangular chart pattern on the daily chart, indicating a possible continuation of the uptrend, possibly heading towards the 203/212/225/261 levels.

Based on this observation, the stock price is likely to continue its upward trend in the short to medium term. On the downside, BEL support is at the 176/164 level. Considering these factors, it can be inferred that BEL has a solid performance towards medium- to long-term profits, according to the brokerage.

2.hero motocorp limited: CMP: INR4,818.55; Goal: INR5,020; Likelihood of increase: 14%

Hero MotoCorp has the largest share in the entry level (100-125 cc) segment and access to tier 2-3 cities and towns will be the main beneficiary during this period.

Strictly speaking, Hero MotoCorp has been trading in a consolidation phase between 2,260 and 2,890 levels for the past two years. On July 3, volume increased significantly and rose above this range, suggesting a positive bias. The stock price is supported by an upward trend line reinforcing the positive trend.

The stock has recently shown a positive crossover above the 50-day and 200-day EMAs on the price chart, with a corresponding increase in volume, supporting the bullish sentiment. Based on these observations, the brokerage recommends buying Hero MotoCorp for medium to long-term gains.

3. Hindustan Unilever Limited (HUL): CMP: INR2,351; Goal: INR2,828; Likelihood of increase: 11%

A strong product profile, leadership positions in key categories and broad distribution reach will position HUL to achieve a faster recovery compared to its peers if demand recovers. At CMP, the stock trades at 58x TTM EPS. INR43.6. Technically, HUL is trading in a symmetrical triangle pattern on the weekly chart, which is a long-term bullish structure.

The stock is in a strong consolidation zone with good volume, which indicates the need to accumulate the stock at lower levels in the medium to long term. The stock is trading above its 200-day exponential moving average, suggesting the long-term trend is bullish.

“Long-term traders are advised to buy and accumulate shares at current levels with a potential target of the 2,630 level,” the brokerage said.

4. Indian Oil Corporation (IOC):CMP: INR189.90; Goal: INR210; Likelihood of increase: 11%

Historically, prices tend to rise after elections (as governments tend to keep prices artificially frozen during voting periods), which increases profit margins for oil marketing companies like Indian Oil. there’s a possibility that.

Technically, IOC has been on an uptrend for the past two years, consistently forming highs and lows on the weekly chart. On November 1, 2023, the stock positively broke out of the bullish flag chart pattern. This is considered a continuation pattern and was accompanied by a significant increase in volume, supporting bullish sentiment.

“Based on these observations, we recommend investors consider purchasing IOC for medium- to long-term gains,” the securities firm said in a report.

5. Indian Railway Catering and Tourism Corporation Limited (IRCTC):CMP: INR951.30; Goal: INR1,080; Likelihood of increase: 16%

IRCTC is eyeing the pan-India non-rail catering business, which it said will grow significantly during this period. Vande Bharat trains (along with Amrit Bharat Express) during this period will also add revenue to Railway Neil, catering and tourism businesses.

Tracking the weekly chart, IRCTC shows a bullish breakout from the symmetrical triangle pattern on the weekly chart, suggesting a positive bias and could move towards the 992/1,120 levels.

Technically, IRCTC’s chart structure is likely to remain strong in the medium to long term, and a move above the above levels could test 1,280, which could lead to a new uptrend. there is. Based on the above observations, investors are advised to buy/accumulate her IRCTC for medium to long term gains.

6. New Delhi Television Limited (NDTV): CMP: INR261.90; Goal: INR325; Likelihood of increase: 21%

Elections are important events where people seek reliable information. His NDTV, a prominent news channel, sometimes sees a surge in viewership during this period. Advertisers can pay a premium to reach a wider audience, which could lead to increased revenue, the brokerage said.

NDTV has shown a breakout from the downside resistance trendline, suggesting a positive outlook in the short term. On the weekly chart, the counter was facing the pressure of resistance trend lines, but has now crossed those levels and remains above them. Volume is also picking up and price momentum is showing positive strength for the stock. According to the brokerage, the stock is trading above its short-term, medium-term and long-term moving averages.

7. State Bank of India (SBI): CMP: INR634; Goal: INR700; chance of increase: 10%

The bank’s performance over the past few quarters has been relatively poor compared to its peers and indexes, making it an attractive buy at its current valuation, which favors a favorable risk-reward ratio. SBI suggested that the price gapped up above 588 and managed to close above, before breaking above the ascending resistance line on the medium-term chart.

The medium-term price pattern resembles an inverted head-and-shoulders structure, paving the way for a sharp rally from current levels. The visual attributes of the candlestick pattern on the weekly chart indicate upward momentum. Technically, SBI’s chart structure suggests a positive bias and it could head towards 670 and 690 levels, the brokerage said.

8. Ultratech Cement Co., Ltd.:CMP: INR9,815.35; Goal: INR10,980; Likelihood of increase: 11%

Continuing the trend of the past few quarters, cement demand remained strong last quarter on the back of strong infrastructure and rural demand. Governments often rush to complete projects before general elections, which usually increases demand for cement in the short term.

Ultratech is the largest company in this field, with a large footprint, expansion goals, and higher production capacity, which could be the main advantage of this event. Recently, the stock has shown a positive breakout from an upward channel chart pattern on the weekly chart, and volume has remained steady, indicating the presence of a positive bias.

The resistance level for the stock price is expected to be at the 10,137/10,241 level, and if it breaks above 10,241, the stock price may head towards the 10,521/11,010 level in the medium to long term. Based on these observations, the stock price is likely to remain positive and we recommend applying a buy-on-the-moment strategy for medium- to long-term gains.

9. United Spirits Limited: CMP: INR1,069.5; Goal: INR1,192; Likelihood of increase: 12%

Consumer behavior is undergoing a tectonic shift, with consumers increasingly experimenting and expanding their repertoire. Additionally, India’s relatively low per capita alcohol consumption compared to other Southeast Asian countries is also expected to support the company’s long-term sales growth.

The weekly chart of MCDOWELL-N shows a clear uptrend with increasing volume. After testing an all-time high of 1,132, the stock entered a consolidation zone with the overall trend remaining bullish.

Additionally, the stock is trading in an ascending channel pattern with steady volume, confirming a positive bias. It is currently trading above both its 50-day moving average and his 200-day moving average, offering a positive outlook for medium to long-term investors.

Ten. varun drinks limited:CMP: INR1,425.05; Goal: INR1,452; Likelihood of increase: 18%

A strong product profile, leadership positions in key regions and broad distribution reach are key growth drivers. “We continue to have a positive view on Varun Beverages despite its elevated valuation given its long-term growth across the various categories it serves. At CMP, the stock trades at 80x TTM EPS. INR15.3,” the brokerage said.

On the weekly chart, the stock is trading well above its major long-term exponential moving averages (100 days – 725 and 200 days – 535), suggesting Varun Beverages’ long-term trend remains bullish. Masu.

On the weekly chart, the stock has been in an upward trending channel since July 2022 and is above the key support level of 1,129, suggesting a positive outlook. Technically, stock prices are likely to remain bullish, and securities companies are proposing buying and accumulating at every dip in order to obtain medium- to long-term profits.

Disclaimer: The views and recommendations expressed above are those of individual analysts or brokerages and not of Mint. We recommend checking with a certified professional before making any investment decisions.