Congress vs Sebi chief Buch: Trading strategies in M&M, Pidilite, Wockhardt

After ICICI and Wockhardt; M&M, Dr.Reddy's and Pidilite are the latest company names to be dragged in the Congress versus Sebi chief controversy. Here's a technical outlook on these stocks.

Mahindra & Mahindra, Pidilite and Dr.Reddy's became the latest company names to be dragged in the so-called 'Conflict of Interest' battle against the Securities and Exchange Board of India (Sebi) chairperson Madhabi Puri Buch by the Congress.

 

The Congress today claimed that Sebi chief and her husband Dhaval Buch received Rs 4.78 crore between 2019 and 2021 from Mahindra and Mahindra (M&M). A claim clearly denied by the automaker.

 

M&M denied the allegations as 'false and misleading''. However, it clarified that Dhaval Buch was hired by Mahindra Group in 2019 "specifically for his expertise in supply chain and sourcing", after he retired as Unilever's global chief procurement officer.

 

 

"We categorically state that we have not, at any point, requested SEBI for any preferential treatment. We maintain the highest standards of corporate governance," Mahindra & Mahindra said in an exchange filing.

 

The Opposition party also alleged that Madhabi Puri Buch's consultancy firm Agora Advisory received income from Dr Reddy's Lab, Pidilite and ICICI while holding the position as market regulator. Earlier, Congress had also made allegations of Sebi chief receiving rental income from Wockhardt's subsidiary even as the latter company was under Sebi investigation.

 

Against, these multiple controversies, what should your trading strategy be in these stocks. Here's a trading guide:

 

Mahindra & Mahindra (M&M)

Current Price: Rs 2,695

Downside Risk: 13.7%

Support: Rs 2,690; Rs 2,629

Resistance: Rs 2,758; Rs 2,781

 

M&M stock is seen testing its 20-WMA (Weekly Moving Average) - a key moving average that the stock has held since mid-November 2023. The 20-WMA now stands at Rs 2,690. On the daily scale, the stock seems on course to test support at its 100-DMA (Daily Moving Average), which stands at Rs 2,629. CLICK HERE FOR THE CHART

 

The key momentum oscillators on the weekly and monthly chart have shown negative crossovers in recent trading days. Hence, the stock may witness downward pressure in the near-term. As such, the stock could dip to Rs 2,326 levels.

 

The overall bias is likely to remain tepid as long as the stock trades below Rs 2,845, with interim resistance seen at Rs 2,781 and Rs 2,758 levels.

 

Dr. Reddy's Lab

Current Price: Rs 6,654

Downside Risk: 8.1%

Support: Rs 6,382

Resistance: Rs 6,752; Rs 6,873; Rs 7,000

 

Dr.Reddy's is seen trading below its 50-DMA for the last three days. The 20-DMA at Rs 6,873 seems to be converging on the 50-DMA at Rs 6,752. As and when this crossover takes place, the near-term bias shall turn negative for the stock. CLICK HERE FOR THE CHART

 

For now, the stock seems on course to test its 20-WMA at Rs 6,382 levels; break and sustained trade below the same can trigger a fall towards Rs 6,115. The overall bias is likely to remain tepid as long as the stock trades below Rs 7,000-mark.

 

Pidilite Industries

Current Price: Rs 3,244

Upside Potential: 4.8%

Support: Rs 3,235; Rs 3,215

Resistance: Rs 3,265; Rs 3,323

 

Pidilite Industries is seen trading along the higher-end of the Bollinger Bands on the daily scale. The price-to-moving averages action is also favourable for the stock. For the positive momentum to continue the stock will need to cross and sustain above the hurdles at Rs 3,265 and Rs 3,323. CLICK HERE FOR THE CHART

 

On the upside, the stock is trading in unchartered territory, and may look to extend the rally towards Rs 3,400 levels. Near support for the stock is visible at Rs 3,235 and Rs 3,215; below which it may test Rs 3,100 levels.

 

Wockhardt

Current Price: Rs 1,036

Upside Potential: 16.3%

Support: Rs 1,019; Rs 930

Resistance: Rs 1,110; Rs 1,145; Rs 1,175

 

Wockhardt Pharma stock is seen testing support around its 20-DMA for the last couple of trading sessions. The stock has zoomed over 383 per cent in the last 11 months. The long-term chart shows that the overall bias for the stock is likely to remain upbeat as long as the stock trades above Rs 1,019 levels; below which support for the stock exists at Rs 930.

 

On the upside, the stock can potentially rally to Rs 1,205; with interim resistance seen at Rs 1,110, Rs 1,145 and Rs 1,175 levels. CLICK HERE FOR THE CHART