Podcast | Stock Picks of the Day: 2 largecap, 3 midcap buy ideas that could return 8-28%

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26 Aug, 2025 12:21

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Shabbir KayyumiNarnolia Financial Advisors

The Nifty is feeling the heat at higher levels due to mixed global cues. We expect it to consolidate between 11,075 and 10,930 levels. Follow through buying is needed to initiate fresh leg on the upside above 11,075 levels.

Recently, the index gave a 'Double Top' buy signal on the Point & Figure Chart after closing above 10,876 levels. As per this pattern, the minimum target comes to 11,228, unless it closes below 10,600 levels. Confirmation of the pattern breakout suggests upside will continue in the future.

Although the Nifty is consolidating on the higher side, the moving average convergence divergence (MACD) line is an inch above the signal line, which shows that the bullish bias is intact.

On the daily technical chart, the benchmark index has formed a classical Flag pattern. After completion of a flagpole, it is currently trading inside a Flag consolidation. Once it gives a decisive closing above 11,078 levels, we can conclude the flag pattern and a breakout would offer targets towards 11,400 levels.

Looking at the options data, the highest put open interest (OI) is seen around 10,800 strikes, followed by 11,000 strikes. Maximum call OI is seen around 11,100 levels, followed by 11,000. Option data signifies an immediate trading range between 11,100 and 10,800 levels.

We expect sideways to bullish movement in the coming session, within a range of 11,200 on the higher side and 10,850 on the lower side. On the contrary, if the Nifty closes below 10,900 levels, a further correction could take it to 10,830/10,770 levels.

The Bank Nifty is trading in a tight range of 27,200 and 26,650. If it sustains above 27,200 levels, it could head towards 27,700-28,000 levels. However, resistance is seen around 27,400 followed by 27,600.  Support lies at 26,800 followed by 26,650 levels.

Here is a list of 5 stocks that may return 8-28% return in the short term: 

Ashok Leyland: Buy | Buy range: Rs104-Rs 106| Target - Rs 135| Stop Loss - Rs 90| Return - 28%

After giving a breakdown below Rs 123 levels, it slipped sharply towards its lower level but parity on the weekly time frame chart can provide a halt to the downtrend in the near-term.

RSI seems to be bottoming out in an oversold zone which raises the possibility of a bounce back on the higher side. Looking at the aforementioned rationale, one can buy this at the levels of Rs 104-106 with a stop loss of Rs 90 and an upside target of Rs 135.

Bank of India: Buy | Buy Range: Rs 81-Rs 83| Target - Rs 100| Stop Loss - Rs 72| Upside - 20%

The weekly chart of Bank of India reveals that it has formed a Dragon Fly Doji which is a trend reversal candlesticks pattern. At the same time, positive divergence in RSI on the weekly chart is also giving the possibility of a pullback on the higher side.

The lower time frame of the chart also gave a breakout through its double bottom pattern which has created a positive rhythm on the upside.

By looking at all these supportive technical factors, one can accumulate this stock around Rs 81-83 with the stop loss of Rs 72 and a target of Rs 90 and Rs 100 levels.

Escorts: Buy | Buy Range: Rs 820- Rs 830| Target - Rs 950| Stop Loss - Rs 749 | Return - 15%

After hitting a peak of Rs 1,017, the scrip corrected sharply. Point of polarity creates the opportunity of role reversal near the levels of Rs 820-830 where it can halt its southward movement and give a chance of maintaining the favorable risk-reward ratio.

Oversold RSI and stochastic near the levels of 30 can push the scrip on the higher side. Buying momentum will develop when it surpass above Rs 880 with decent volume after which it will accelerate towards Rs 930 marks.

To justify the support at the lower level, it has to sustain above its 200-DMA which comes around Rs 827 levels.

Kaveri Seed: Buy | Buy Range: Rs 570-Rs 580| Target - Rs 630 | Stop Loss - Rs 530| Return - 9%

Kaveri Seeds is trading with a higher high and higher low formation which is a sign of a positive trend. Recently, RSI which crossed 50 marks hints at a bullish tone.

At the same time, sustainability above Rs 580 –590 levels can give a spurt towards its unchartered territory near Rs 600 and Rs 630 marks. Its 200-DMA is around Rs 530 and it is trading above all the short-term moving averages which is a sign of strength.

We recommend initiating a long position in KSCL around Rs 570-580 levels by keeping a stop loss at Rs 530 and the upside targets are Rs 600 and Rs 630.

Reliance Industries: Buy | Buy Range: Rs 1,110-Rs 1,100 | Target - Rs 1,200 | Stop Loss - Rs 1,060| Return - 8%

After giving break out from the rising channel which was observed on the weekly chart, RIL took a sharp move on the upside and consolidated near the peaks of Rs 1,100 where it formed a Flag pattern on the daily chart.

Sustainability above Rs 1,100 –1,110 levels can give a spurt towards its unchartered territory near the levels of Rs 1,170 and Rs 1,200 mark.

However, indicator and oscillator are lending its support to its price action. One can go long near the levels of 1100-1110 with the stop loss of Rs 1,060 for the target of Rs 1,170 and Rs 1,200 mark.

Disclosure: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.

Disclaimer: The author is Head - Technical & Derivative Research, at Narnolia Financial Advisors. The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.