Buy, Avoid and Hold! Analyst bullish on auto stocks, recommends this on Tata Motors, Maruti, Motherson Sumi

Buy, Avoid or Hold – The stock markets were trading with strength on Thursday as the 50-share Nifty50 was up over 1 per cent and was trading at 17,834.75. Among key sectoral indices, Nifty Auto was the biggest gainer in the intraday trade. It was trading up 4.7 per cent around 2:30 pm at 17,834.75. 

In the 50-share index, all the stocks advanced with Tata Motors being the biggest gainer, hitting a 52-week high today. 

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Technical Analyst Nilesh Jain is bullish on the sector and recommends this on three stocks – Tata Motors, Maruti Suzuki and Motherson Sumi.  

Jain, Assistant Vice President (AVP), Equity Research Technical and Derivatives at Centrum Broking, recommends a ‘Hold’ on Tata Motors and see an upside up to Rs 430 in short term, while Rs 450 with a positional term view. 

This stock was trading at Rs 376.70 on the NSE on Thursday, up almost 12 per cent from the Wednesday closing price. He advised against any fresh positions in this stock on the back of a strong rally. "Buy on dips is recommended," he said. 

The AVP was also bullish on Maruti Suzuki India Limited. The shares were trading at Rs 7,493, gaining almost Rs 293 or 4 per cent in the intraday trade. He puts a target price at Rs 8000 with a stop loss at Rs 7,200. The stock is trading at a discount from its 52-week high of Rs 8,329, which it hit on 12th January 2021.  

Another stock recommended by him from the automobile sector was Motherson Sumi Systems Limited. This share was trading at Rs 236.35 on the NSE, up 5.6 per cent from the last closing price on Wednesday. He gives two targets - Rs 250 over short term and Rs 270 over a positional term period. 

He also recommends ‘Avoid’ on stocks, including Cipla Limited, Divi’s Laboratories Limited and Container Corporation of India (CONCOR) on the back of mixed signals on technical charts. 

His recommendations are based on the technical analysis of the stocks and not based on the fundamental analysis.  

Cipla shares were trading at Rs 915.75, up 0.25 per cent, while Divi’s at Rs 5101, down 0.7 per cent. Meanwhile, CONCOR was down 0.3 per cent and was trading at Rs 694.35 around this time.