Stocks to buy for short term: Jigar Patel of Anand Rathi picks 3 shares to buy for the next 2-3 weeks

Stocks to buy for short term: Extending losses into the second consecutive session, Indian stock market benchmark, the Nifty 50, fell over a per cent in intraday trade on Monday, January 27. Caution ahead of Budget 2025, heavy foreign capital outflow, weak Q3 earnings and Donald Trump's policy uncertainty are the key factors behind the ongoing market selloff.

"Uncertainty surrounding Trump's economic policies and high valuations may impact the stock market in the short term, especially in emerging markets. Broadly, Q3 results are in line with the expectations but are not helping the market, which is following the sell-on news trend," said Vinod Nair, Head of Research, Geojit Financial Services.

"Key events, such as the FOMC meet and Union Budget, will influence market sentiment. While the FOMC maintains a hawkish stance, Trump's push for rate cuts can add a positive undertone in the future. Expectations for the Union Budget remain subdued; however, the conclusion of this major event without any negative surprises could help alleviate market concerns," Nair said.

Market sentiment remains weak. At this juncture, experts recommend betting on select quality stocks. Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers, recommends buying shares of IRCTC, Hindustan Unilever and Dabur for the next two to three weeks. Here's what the expert says:

Shares to buy

Indian Railway Catering And Tourism Corporation (IRCTC) | Previous close: ₹787.50 | Buying range: ₹775-790 | Target price: ₹860 | Stop loss: ₹740 | Upside potential: 9%

On January 14, 2025, IRCTC formed a Bullish Harami pattern, followed by a strong 5 per cent rally, signalling a potential trend reversal. Notably, this pattern emerged near a key historical support level from September 2023, reinforcing its significance. Additionally, the RSI on the daily chart has shown a bullish divergence, indicating a shift in momentum and strengthening the bullish case.

"This confluence of factors—bullish price action, support at a critical level, and RSI divergence—suggests a potential upside move. Based on this technical setup, we recommend going long in the price range of ₹775-790. A stop-loss is placed at ₹740 on a daily closing basis to limit risk, while the target for this trade is set at ₹860, offering a favourable risk-reward ratio," said Patel.

Hindustan Unilever (HUL) | Previous close: ₹2,368.10 | Buying range: ₹2,340-2,365 | Target price: ₹2,560 | Stop loss: ₹2,250 | Upside potential: 8%

Hindustan Unilever recently formed a strong technical setup with four extended bottoms, accompanied by bullish divergence on the charts. This indicates a potential reversal or uptrend. In the previous trading session, HUL exhibited robust momentum, supported by forming a hammer-like bullish candlestick pattern near its long-term support zone of ₹2,265-2,250.

"This confluence of technical signals suggests that the stock is at an attractive level for a possible upward move. Considering these factors, we recommended going long in the range of ₹2,340-2,365, targeting ₹2,560 as the upside potential. To manage risk, a stop-loss at ₹2,250 on a daily close basis was advised, ensuring a disciplined approach to trading," said Patel.

Dabur India | Previous close: ₹521.65 | Buying range: ₹520-522 | Target price: ₹580 | Stop loss: ₹490 | Upside potential: 11%

Over the past two to three months, Dabur has shown significant stability around the ₹500 level, which has been a strong long-term support since 2022. This stability indicates the stock’s resilience at these levels.

Furthermore, Dabur is currently sustaining above the monthly Central Pivot Range (CPR), a key indicator of bullish sentiment. On the daily chart, a bullish divergence and the formation of a bullish shark pattern are visible, both of which suggest a potential upward reversal.

"These technical factors make Dabur a lucrative opportunity at current levels. Based on this analysis, we recommended going long in the ₹520-522 zone, targeting ₹580 as the upside potential while placing a stop-loss at ₹490 on a daily close basis to manage risk," said Patel.

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Disclaimer: The views and recommendations above are those of individual analysts, experts, and brokerage firms, not Mint. We advise investors to consult certified experts before making any investment decisions.