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Stock markets today continue to witness retracement in Nifty IT index for second successive session. However, stock analysts are still bullish on IT stock as they see this dip in IT stocks as mere profit-booking by investors. They said that current dip in IT stocks may further go down but this dip in IT stocks should be seen as buying opportunity and suggested positional investors to buy quality and new age IT stocks like Infosys, HCL Tech, Firstsource Solutions or FSL, Birlasoft and Allsec Technologies.
Expecting further dip in Nifty IT index; Ruchit Jain, Lead Research at 5paisa.com said, “After a long time, the IT index witnessed some profit booking. On the daily chart, the Nifty IT index had formed a ‘Hanging Man’ candlestick pattern and has breached its short term support on Tuesday. So in the near term, we expect some profit booking in this space to further continue.”
Recommending buy on dips strategy to positional investors; Sumeet Bagadia, Executive Director at Choice Broking said, “Nifty IT index had been trading at record high and profit booking in the space was strongly expected. However, outlook for IT stocks are still looking strong and one should look at the current dip as buying opportunity.”
Sumeet Bagadia of Choice Broking listed out these 5 IT stocks to buy on dips:
1] Infosys: One can buy Infosys shares around ₹1750 to ₹1800 for immediate short term target of ₹1950 to ₹2000 maintaining stop loss at ₹1700 levels.
2] HCL Tech: The IT major looks promising on chart pattern and one can buy this stock around ₹1250 to ₹1270 for short term target of ₹1370 and ₹1450 maintaining stop loss at ₹1200 levels.
3] Firstsource Solutions or FSL: One can buy and hold the stock for ₹200 and ₹225 targets in short term maintaining stop loss at ₹160 levels.
4] Birlasoft: Sumeet Bagadia of Choice Broking said that one can initiate momentum buy in the IT counter for short term target of ₹580 and ₹600 maintaining strict stop loss at ₹520.
5] Allsec Technologies: One can buy the stock at CMP and hold the counter for short term target of ₹750 and ₹800 maintaining stop loss at ₹630 levels.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
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