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Unlocking Investment Opportunities: Expert Stock Recommendations Amid RBI Rate Cut

February 7, 2025
Smart Money

RBI Announces Repo Rate Cut Under New Governor

In a significant move that has garnered attention from economists and investors alike, the Reserve Bank of India (RBI) has reduced its repo rate from 6.5% to 6.25%. This decision was made during a recent Monetary Policy Committee (MPC) meeting chaired by the newly appointed Governor Sanjay Malhotra. The unanimous decision to cut the repo rate is expected to stimulate economic growth and provides a supportive environment for rate-sensitive stocks.

Rate Cut Amid Global Economic Challenges

In his announcement, Governor Malhotra acknowledged the ongoing challenges in the global economy, stating that “progress in global disinflation is stalling.” The RBI’s move reflects a proactive stance amid these turbulent economic conditions, aimed at fostering a conducive environment for growth and investment.

Expert Predictions on Rate-sensitive Stocks

Following the announcement, Moneycontrol conducted a poll among economists, bank treasury heads, and market experts. The consensus was clear: a majority expect that the RBI’s rate cut will positively impact rate-sensitive stocks. Experts have identified a list of 11 such stocks that investors should watch in the short term:

1. Bajaj Finance (CMP: ₹8,507.3)

Bajaj Finance has shown a bullish trend, having broken out from a triangle formation. With a positive price momentum, experts advise investors to buy on dips, targeting levels of ₹8,850 and ₹9,200, with a stop-loss at ₹8,100.

2. Ujjivan Small Finance Bank (CMP: ₹38.65)

Having recently broken out of a rectangular trading range, Ujjivan is expected to continue its upward movement. Buyers are encouraged to enter the stock at ₹38-38.30, with targets set at ₹41-42 and a stop-loss at ₹37.

3. Ganesh Housing Corporation (CMP: ₹1,480.05)

This stock has maintained an upward trajectory and is currently near a pivotal swing high of ₹1,485. A breakout above this level could see targets of ₹1,560 and ₹1,630, with a stop-loss set at ₹1,420.

4. Maruti Suzuki India (CMP: ₹13,074)

Maruti Suzuki is forming a bullish Cup and Handle pattern, with a key breakout point at ₹13,130. A successful breakout could drive the stock towards ₹13,800, while a stop-loss at ₹12,900 is recommended.

5. IndusInd Bank (CMP: ₹1,065.55)

After breaking out from a falling trendline, IndusInd Bank is showing bullish signs. A buy signal is suggested above ₹1,070 with a target of ₹1,125 and a stop-loss at ₹1,050.

6. ICICI Bank (CMP: ₹1,272.4)

Currently consolidating after a flag breakout, ICICI Bank is on the verge of pushing above ₹1,278. Traders should look for a target of ₹1,330, with a stop-loss at ₹1,255.

7. State Bank of India (CMP: ₹752.25)

SBI has reached a crucial trendline support level. Investors are advised to consider buying near this support with a target of ₹785, maintaining a stop-loss at ₹735.

8. HDFC Bank (CMP: ₹1,743.85)

HDFC Bank has successfully broken above its VWAP resistance, indicating strength. A target of ₹1,800 is set, with a cautious stop-loss at ₹1,715.

9. Kotak Mahindra Bank (CMP: ₹1,916)

Indicating a bullish trend through consecutive higher bottoms, Kotak Mahindra Bank has a target price of ₹2,127, with a stop-loss at ₹1,801.

10. City Union Bank (CMP: ₹173.12)

With a bullish signal seen in its weekly performance, City Union Bank is recommended for purchase, targeting ₹203 and maintaining a stop-loss at ₹162.

11. KFIN Technologies (CMP: ₹1,170.3)

Having shown a robust upward movement, KFIN Technologies is expected to recover from its recent 25% correction towards a target of ₹1,406, with a protective stop-loss of ₹1,078.

Investment Advice

Investment experts caution that the views and strategies expressed here are based on market analysis and should be taken as informational only. Investors are encouraged to conduct their research or consult with certified financial advisors before making any investment decisions.

The recent repo rate cut marks a pivotal moment for the Indian economy, and the expected ripple effects on rate-sensitive stocks may present attractive opportunities for investors looking to capitalize on potential market movements.