Shares to buy: After range-bound trade session in the first half on Tuesday, Indian stock market finally showed some signs of recovery as both BSE Sensex and NSE Nifty closed after logging more than 1.35 per cent gains. However, for surprise to the share market investors; tech and IT indices closed in the red zone. IT index closed 2.63 per cent lower from its Monday close while the tech index ended up closing 2.05 per cent down. However, if we go by the views of stock market experts, there is nothing to worry about this slide in IT and tech indices as it happened due to the profit-booking that triggered selloff in IT and techs. They said that there can be some further dip of 4-5 per cent in the quality IT stocks creating opportunity for investors to take buy position. Asked about the top 5 IT stocks that one can look at, experts pointed out Infosys, TCS, Tech Mahindra, HCL Tech and MphasiS.
Speaking on top 5 IT shares to buy for short term Sumeet Bagadia, Executive Director at Choice Broking said, “Infosys is going to announce share buyback and the history suggests that before the buyback announcement, IT stocks dip to the tune of 4-5 per cent. It happens in majority of the IT stocks. Hence, w e can witness 4-5 per cetn dip in quality IT stocks like Infosys, TCS, HCL Tech, Tech Mahindra and MphasiS.” Bagadia went on to add that once the share buyback by Infosys will be announced, there will be sharp rise in these IT stocks.
Asked about the strategy that one can maintain while trading or investing in these IT stocks Bagadia said, “One can take position in these stocks when these stocks dip to the tune of 4-5 per cent from its Tuesday closing and book profit after 8-10 per cent rise from their buying position.”
On which of these five shares are best placed Rohit Singre, Senior Technical Research Analyst at LKP Securities said, “Infosys and Tech Mahindra are looking promising on the technical chart. One can buy Infosys in the range of ₹1,350 to ₹1,400 for one month target of ₹1,600 maintaining stop loss at ₹1,300. Similarly, one can buy Tech Mahindra shares at current market price for the target of ₹1,080 maintaining stop loss at ₹950.” He said that the time horizon for Tech Mahindra is also one month.