Market Watch: Brijesh Bhatia, Senior Research Analyst, Equitymaster

Asian Paints

It has been on a roll since his breakout at Rs 2,500-2,600 levels, it made a higher around Rs 3,500. In the last expiry week of September, we witnessed some profit booking or unwinding from the long’s but again the start of October has been on a very stronger side. Technically, looking at the chart, it has been trading at the breakout retest level of around Rs 3180 and the 50-days average was placed and if you look at it since the 2020 recovery, this stock hasn’t broken the 50-days average. So every time it retests or is a couple of percent higher from the 50-days average, the stock moves again onto the upward trajectory. So Rs 3,150-3,130 till it is not broken, it can head higher above to the all-time high of around Rs 3,500 levels and we might see somewhere around Rs 3,700-Rs 3,800 levels also on this.

PFC

From September end till the start of October, power stocks have been one of the strongest performing sectors and we have seen frequent sector additions happening since the August rally and now it’s time for power. Other power stocks like Tata power and others have been gaining strong momentum. The BSE Power index as well since June to September formed a huge bottoming formation – a rounding bottom formation and now it has been breaking out.

PFC also has seen previous highs breakout which was consolidating for quite a long. We have seen bullish head and shoulder breakout as well. Being retested those levels at around Rs 139 last week and now gaining the strong upside momentum. So, with the Tata Power gaining strong upside momentum, – if you look at the momentum with Tata power and PFC, they generally go hand in hand, though the time cycle might differ over here, but expect the moving PFC like that of Tata power, so probably Rs 160- Rs 165 can be seen on PFC as well.

Amara Raja Batteries

The auto sector has done nothing, and even ancillaries have done nothing for quite a long and Amara Raja Batteries is down by around 30- 35 percent from the highs of 2021. The huge bottom formation has happened since June. Huge accumulation has happened in the range of around Rs 750 on the downside to the higher levels. Even Maruti in the last week has seen a huge momentum, Tata Motors has seen a huge momentum so ancillaries might follow.

For the next six to 12 months as well, this battery stock is forming a huge bottom formation and we might see again, the four-digit level coming on to this till around Rs 700 levels.