Paytm, Sapphire Foods, L&T shares: Buy or sell? Jigar Patel of Anand Rathi suggests strategy - Target, stop-loss
Market benchmarks, the Sensex and the Nifty 50 lost more than 2% each for the week ended 23 October amid rising crude oil prices.
From a technical perspective, the Nifty witnessed a correction following the previous week’s rally of approximately 1,000 points.
According to Jigar S. Patel, Senior Manager of Equity Technical Research at Anand Rathi Share and Stock Brokers, a pullback after such a sharp advance was anticipated. However, Patel underscored an important development has emerged on the hourly chart of the Relative Strength Index (RSI).
"During the recent rally, the hourly RSI crossed the crucial 70 mark for the first time since August 2026. Despite the subsequent correction of approximately 700 points, the indicator has continued to hold above 40, suggesting that underlying momentum remains relatively resilient," Patel said.
"We maintain our buy-on-dips strategy, provided the Nifty holds above 22,200 on a daily closing basis. A decisive close below this level would weaken the bullish outlook," Patel said.
For Bank Nifty, Patel said an extended bottom formation accompanied by bullish RSI divergence on the hourly chart indicates a possible weakening of selling pressure.
"Going ahead, the 54,000–53,800 zone will be critical for sustaining the recovery outlook. On the upside, a sustained move above 55,000 could trigger further gains towards 56,000. However, a breakdown below 53,800 would weaken the bullish outlook," said Patel.
One 97 Communications (Paytm) | Sell between ₹1,630 and ₹1,635 | Target price: ₹1,500 | Stop-loss: ₹1,690
According to Patel, Paytm is showing signs of weakness after decisively breaching the crucial support levels of ₹1,640 and ₹1,620 on a closing basis.
The breakdown indicates a deteriorating price structure and raises the possibility of further downside in the near term.
"The Relative Strength Index (RSI) on the 2-hour and 3-hour charts has already slipped below the 30 mark, signalling intense selling pressure. While an RSI reading below 30 indicates an oversold condition, it does not necessarily imply an immediate reversal and may reflect continued weakness," Patel added.
"Any recovery towards ₹1,630– ₹1,635 could provide an opportunity to sell, with a stop-loss at ₹1,690 and a downside target of ₹1,500," he said.
Sapphire Foods | Buy | Target price: ₹221 | Stop-loss: ₹180
Sapphire Foods is trading near its previous demand zone, where buying interest has emerged over the last three to four trading sessions.
"The ₹185– ₹190 range has acted as a crucial support zone, with the stock managing to hold this area despite recent selling pressure. This indicates that buyers are attempting to defend the lower levels," said Patel.
From a technical perspective, a bullish divergence is visible on the daily chart based on the 7–8 period Relative Strength Index (RSI). This setup suggests that the underlying selling momentum may be weakening, raising the possibility of a short-term recovery.
"The combination of support near the previous demand zone and improving momentum strengthens the bullish outlook," Patel said.
"Considering these technical factors, the stock offers a potential buying opportunity with a stop-loss at ₹180 and an upside target of ₹221. A sustained hold above the ₹185– ₹190 zone will be important for the anticipated recovery," said Patel.
L&T | Target price: ₹3,900 | Stop loss: ₹3,550
Patel pointed out Larsen & Toubro (L&T) is showing signs of base formation near the crucial ₹3,600 level, which is emerging as a strong support zone.
This level coincides with the monthly Camarilla support and a previous demand zone, where buying interest had emerged earlier. The confluence of these technical factors strengthens the possibility of a recovery from current levels.
The Relative Strength Index (RSI) is holding just above the oversold zone, indicating that selling pressure may be easing. If the stock sustains above ₹3,600, a rebound towards ₹3,900 cannot be ruled out.
However, a decisive breakdown below this support could weaken the technical structure.
"Considering the favourable risk-reward setup near the support zone, traders may consider buying L&T with a stop-loss of ₹3,550 and a target of ₹3,900," said Patel.
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HomeMarketsStock MarketsPaytm, Sapphire Foods, L&T shares: Buy or sell? Jigar Patel of Anand Rathi suggests strategy - Target, stop-loss
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