GAIL, BEL, GMDC: Bullish PSU stocks may see up to 20% upside

Shares of listed Gujarat based PSUs (Public Sector Undertaking) such as Gujarat State Fertilizers & Chemicals, Gujarat Mineral Development Corpn and Gujarat Narmada Valley Fertilizers and Chemicals locked in their respective upper circuits on Tuesday after the state government announced a new policy for minimum level of dividend distribution and bonus shares to the shareholders. 

Other PSUs like GAIL (India), Power Grid Corporation of India and Bharat Electronics could follow suit, as they all trade at the higher range of their respective peaks. 

Despite benchmark indices witnessing corrective phases in recent months, GAIL (India) and Power Grid Corporation of India, in particular, have been entering uncharted territories effortlessly.

Here’s the technical outlook of these PSUs and their future outlook:-- 

Gujarat Mineral Development Corpn Ltd (GMDCLTD)

Likely target: Rs 185

Upside potential: 20%

The counter broke out on the upside of the “Descending Triangle” post locking in 20 per cent upper circuit in the recent session, as per the weekly chart. Technically, the said pattern is a bearish indicator however when the breakout transpires in the opposite direction, the price action become furious and swift. And so is the case with Gujarat Mineral Development Corpn.

Following this, the stock is expected to scale higher levels of Rs 185, which is the next hurdle mark, til the support of 200-DMA set at Rs 146 level is protected. CLICK HERE FOR THE CHART

Gujarat State Fertilizers & Chemicals Limited (GSFC)  

Likely target: Rs 170 and Rs 180 

Upside potential: 12% - 20%

Since the start of the current year, the stock was seen struggling to cross the hurdle range of Rs 135 to Rs 131 levels. The recent gap up move has not only crossed this barrier, but even succeeded to embark a new trend surpassing the 200-DMA placed at Rs 135 mark.

The stock is anticipated to rally in the direction of Rs 170 and Rs 180, which are the crucial obstacles, as per the daily chart. Support for the stock exists at Rs 145 and Rs 135 levels. CLICK HERE FOR THE CHART

GAIL (India) Limited (GAIL)

Likely target: Rs 125

Upside potential: 13%

Shares of GAIL (India) have broken out of the “Flag pattern”, as per the daily chart. And unless the support of Rs 105 is breached, the counter is anticipated to scale higher highs. The candlestick formations denote a positive rally towards Rs 125 levels.

The medium-term outlook for the stock continues to be robust, as the “Golden Cross”, breakout on the daily chart, reveals accumulation at relevant supports. CLICK HERE FOR THE CHART

Power Grid Corporation of India Ltd (POWERGRID)

Likely target: Rs 275

Upside potential: 15%

The current scenario on the daily and weekly chart indicates a struggle to absorb all the selling pressure emerging at the barrier range of Rs 240 to Rs 235. Once this mark is conquered, the upside breakout might jump to Rs 275.

The “Rising channel” pattern seems to withstand any weakness or selling pressure. The rising trendline reveals support at Rs 225 levels, as per the daily chart. CLICK HERE FOR THE CHART

Bharat Electronics Ltd (BEL)

Likely target: Rs 120

Upside potential: 17%

Shares of Bharat Electronics have a “Double Bottom” breakout, as per the daily chart. This move has led to a medium-term bullish sentiment. The immediate support for the stock exists at Rs 98-mark, which shall be considered on the closing basis. 

The MACD has jumped over the zero line, suggesting its support in the uptrend. The stock is headed in the direction of Rs 120 levels. CLICK HERE FOR THE CHART