Nifty can witness profit booking; 3 stocks which can give 11-20% return in short term

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26 Aug, 2025 12:21

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Vikas Jain

Sensex, Nifty and Bank Nifty scaled fresh all-time high on the back of sustained positive momentum across sectors in the past few weeks. The quarterly earnings season is being very strong with positive surprises from cement sector, ACC and Ambuja; consumer sector, ITC and Asian Paints; financial services, Shriram Transport & M&M Financial Services; and pharma, Biocon and Dr Reddy’s Lab.

Crude continues to remain in corrective phase below USD 75 per barrel auguring well for the economy and the oil marketing companies.

Nifty has ended 2.4 percent higher, while midcap and smallcaps outperformed to gain by 4 percent and 5.3 percent, respectively, for the week.

The Nifty Next 50 gained by 6 percent outperforming the broader markets, while among sectors, PSU banks, metals and FMCG were up by 10.4 percent, 6.6 percent and 5 percent, respectively, for the week.

Auto, energy and pharma gained 1 percent each, while IT witnessed some amount of profit booking to decline 1.2 percent. India VIX declined 9 percent for the week.

Nifty should see resistance near 11,400 levels and we believe it can witness some profit booking from the higher range. The fiscal deficit data and credit policy in the next week will be important to watch as CPI and WPI for June 2018 were higher than expectations.

Among sectors we continue to remain positive on pharma, auto and metals from current levels and the recent correction in two-wheeler stocks offers a good opportunity to accumulate at current levels.

Here is a list of 3 stocks which could give up to 20% return in the short term:

CESC | CMP: Rs 952| Rating: Buy| Target: Rs 1090-1150| Stoploss: Rs 869 | Return: 20 percent

The stock found strong support around Rs870, where its long-term moving averages and (as per the change of polarity principle) prior resistance turned supports are placed.

Bullish cross-over in RSI and Stochastic are signaling turnaround in the stock.

We believe the stock will soon resume its northward journey and will revisit the prior swing highs.

Thus long position can be initiated here for the target of Rs 1090-1150 with a stop loss of Rs 869.

Lupin | CMP: Rs 815| Rating: Buy| Target: Rs 895-910| Stoploss: Rs 770 | Return: 11 percent

The stock reversed after taking support of its 20-weeks moving average and has closed positive w-o-w with multiple supports near to 780 levels.

We have observed positive divergence in RSI and Stochastic trading at the lower end of the range.

As per the current daily set-up, the stock has completed his 76.4% retracement of the previous move (945-726) near 780 levels and it will recover prior damages.

Thus long position can be initiated here for the target of Rs 895-910 with a stop loss of Rs 770.

Strides Shasun | CMP: Rs 360| Rating: Buy | Target: Rs 395-420| Stoploss: Rs 339 | Return: 16 percent

The stock has formed Higher Bottom after witnessing sharp decline, signaling lack of selling interest.

RSI and MACD are positively poised above their averages, indicating strength in the stock.

As per the current daily set-up, our view is positive for the stock, but near-term consolidation cannot be ruled out as Stochastic has given negative cross-over after visiting its overbought zone.

Thus long position can be initiated here for the target of Rs 395-420 with a stop loss of Rs 339.

Disclaimer: The author is Sr. Research Analyst, Reliance Securities. The views and investment tips expressed by investment expert on moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.