Stocks to buy: IGL, 2 other gas shares well placed on technical charts, buy for 21% upside

Chartists at Prabhudas Lilladher have narrowed down three gas stocks that they believe could help investors pocket gains. 

Stocks to buy: IGL, 2 other gas shares well placed on technical charts, buy for 21% upside
Stocks to buy (Image: REUTERS)

Domestic stock markets have begun the week with gains as Sensex and Nifty 50 rose higher on Monday. S&P BSE Sensex was up 0.70% to sit at 58,800 while the NSE Nifty 50 index was comfortably above 17,500. Meanwhile, India VIX, was up in the green, breaching 19 levels. Some analysts have now started questioning the valuations of domestic markets after the recent rally since Foreign Institutional Investors started pumping in money. A stock-specific strategy is something that many would advise in such a scenario. Chartists at Prabhudas Lilladher have narrowed down three gas stocks that they believe could help investors pocket gains. 

Indraprastha Gas: BUY
Target: Rs 410 per share
Upside: 14%

After having tanked 24% so far this year, analysts at Prabhudas Lilladher believe IGL stock is now ready for an up-move. “The stock has maintained the support zone near the trendline support of 343 levels and witnessing a consolidation phase with improvement in the indicators. The RSI had indicated improvement and has potential to rise further in the coming days,” they said in a note. Currently, IGL’s share price is trading at Rs 359 per share, up 1.8% on Monday. From Monday’s levels to the target price, the stock could help investors pocket 14% returns. “We suggest buying and accumulating this stock for an upside target of 410 keeping the stop loss near 330 levels,” analysts added.

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Mahanagar Gas: BUY
Target: Rs 980
Upside: 20%

The stock is down 6% so far this year to now trade at Rs 816 per share. However, since the last few days of July, Mahanagar Gas stock has zoomed 12%. “The stock has witnessed a decent pullback from the support zone of 670 levels and moving above the significant 50EMA level of 768 has shown prominent strength with upside movement anticipated in the coming days,” said analysts. Technical analysts said that the PSU stock’s RSI has indicated a reversal from the oversold zone and is on the rise with immense potential on the upside. “With the chart looking attractive, we suggest to buy this stock for an upside target 980 keeping the stop loss of 740,” they added. The target price suggests an upside of 20%.

Gujarat Gas: BUY
Target: Rs 540
Upside: 21%

Gujarat Gas share price has plummeted 30% in 2022 and has been moving sideways for nearly the last one month. “The stock has taken support near the trendline zone of 400 levels and indicated a decent pullback to witness some consolidation near 440-450 zone with overall trend remaining intact,” analysts said. They further added that the RSI indicator is well placed and has indicated strength with further upside potential in the coming days. To reach the target price of Rs 540 the stock has to rally 21% from Monday’s levels of Rs 447 per share. A stop loss of Rs 405 has been recommended. 

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