Stocks to buy: Raja Venkatraman's top picks for 27 November

Three stocks to trade today, recommended by NeoTrader’s Raja Venkatraman

CUMMINS (current price: ₹4,408.30)

Buy above ₹4,417, stop ₹4,350, target ₹4,550 (multiday)

• Why it’s recommended: Cummins India Limited is the largest entity of the Cummins Group in India and a leading manufacturer of diesel and natural gas engines, power generation systems, and related components. On the daily charts we note that the prices, after a series of alternating trends, have got an encouraging tailwind from brokerages reiterating a resumption of bullish trends in this space. With an encouraging closing yesterday, a revival from the neutral zone in RSI could open up some upward bias in the next few days.
• Key metrics:
  • P/E: 53.97
  • 52-week high: ₹4,494.40
  • Volume: 393.58K
• Technical analysis: Support at ₹4,221, resistance at ₹4,600
• Risk factors: Decline in Agent Productivity, regulatory changes and inability to attract/retain talent.
• Buy : above ₹4,417
• Target price: ₹4,550 in 2 months
• Stop loss: ₹4,350

MFSL (current price ₹1,736.70)

Buy above ₹1,740, stop ₹1,710, target ₹1,785 (intraday)

• Why it’s recommended: Max Financial Services Limited is primarily engaged in the life insurance business through its subsidiary Max Life Insurance Company Limited. The stock has been steadily inching higher and after a brief consolidation period in November is now seeing a fresh uptrend as recent support from the TS & KS region has drawn steady buying interest. RSI is seen heading higher and is now inviting us to trade long.
• Key metrics:
  • P/E: 354
  • 52-week high: ₹1,729.90
  • Volume: 827.56K
• Technical analysis: Support at ₹1,650, resistance at ₹1,900
• Risk factors: Unsecured loan segments, declining margins, reliance on bulk deposits, and geographical concentration.
• Buy : above ₹1,740
• Target price: ₹1,798
• Stop loss: ₹1,710

COFORGE (current price: ₹1,871.10)

Buy above ₹1,872, stop ₹1,830, target ₹1,940 (intraday)

• Why it’s recommended: Coforge Ltd., formerly known as NIIT Technologies, is an Indian multinational IT services and solutions provider that uses emerging technologies such as AI, cloud, and data analytics. The stock has been moving in a V shape, indicating some uncertainty until the past few days as the strong push from the TS & KS lines have rekindled fresh hopes of upside. As the RSI is seen reviving, one can expect the rise to continue. Buy.
• Key metrics:
  • P/E: 89.54
  • 52-week high: ₹2,005.36
  • volume: 902.35K
• Technical analysis: Support at ₹1,798, resistance at ₹2,025
• Risk factors: Macroeconomic conditions, talent management, market competition, and operational execution.
• Buy : above ₹1,870
• Target price: ₹1,940
• Stop loss: ₹1,830

How the market performed on Wednesday

The Nifty staged a sharp rebound on 26 November, snapping a three-day losing streak with a powerful rally driven by broad-based buying and supportive global cues. By mid-afternoon the index had surged 323 points or 1.25% to reclaim the psychologically important 26,200 level, marking its biggest single-day gain in five months.

Optimism about a Federal Reserve rate cut next month coupled with dovish commentary from the Reserve Bank of India governor fueled investor confidence and lifted sentiment across sectors. Information technology and metal stocks led the charge, while strong foreign institutional investor inflows on the previous day added momentum.

Market breadth was robust, with more than 2,500 stocks advancing and 1,199 declining. Nifty is now just 65 points shy of its all-time high and could soon scale fresh peaks if the current momentum continues amid favorable global and domestic conditions.

Outlook for trading

From our reading of options data, we had said the Nifty 50 was likely to settle near 25,900, with a put-call ratio (PCR) of 1.02 indicating the market may be oversold and that a price rebound could be imminent. Encouraging global cues ensured that the trends brushed off the erratic expiry and the leadup to the monthly close. The strong gap-up opening followed by the strong rise clearly signalled the resumption of bullish sentiment as the market saw one of its strongest rallies since June. As selling pressure eases, the market seems set to hit a new high.

Open interest data shows some strong put writing now, with Max Pain shifting to 26,150, indicating that the long trade in indices proved correct. The PCR shows the possibility of upside, so we should continue to buy on dips in the coming sessions. While the trends will remain edgy, the bulls definitely have the edge.

The strong surge on Wednesday also started the December expiry on a positive note. Maintain this momentum as will now depend on macro data and geopolitical news.

Raja Venkatraman is co-founder, NeoTrader. His Sebi-registered research analyst registration no. is INH000016223.

Investments in securities are subject to market risks. Read all the related documents carefully before investing. Registration granted by Sebi and certification from NISM in no way guarantees performance of the intermediary or provide any assurance of returns to investors.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.