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Informist, Friday, Jun. 20, 2025

NEW DELHI – Shares of capital goods companies are seen trading sideways with a positive bias next week due to geopolitical uncertainties. The outlook for export-oriented orders of capital goods companies is turning grim in the absence of a clear and firm indication on US tariff policies, analysts at two domestic brokerages said.

Sugandha Sachdeva, founder, SS Wealthstreet, sees the BSE Capital Goods index rising up to 71800 points next week. "Once the 71800 level is breached, there is going to be a sharp rise. I maintain the level of 73500 in the medium term," she said. Sachdeva is bullish on AIA Engineering and CG Power and Industrial Solutions for the coming week.

While investors factor in the first two quarters as typically dull for engineering, procurement, and construction companies, the early onset of monsoon coupled with rising geopolitical uncertainties this year may dampen investor sentiment, according to Arun Kailasan, research analyst at Geojit Investments Ltd. However, overall margins of these companies will be sustained as higher crude oil prices will be offset by moderation in steel and aluminium prices, he said. Kailasan is bullish on transmission and distribution companies amid healthy order books. Higher valuations of stocks of some of these companies may, however, be a concern for a section of investors, he said.

Sachdeva is bullish on the sector in the second half of the ongoing calendar year, particularly the last quarter of the year. "Domestic macros are very supportive. We're not able to see new highs for benchmark indices and many sectoral indices only because of global cues," she said.

On Thursday, Elara Securities kept its rating unchanged on BEML at 'accumulate' after the company's management guided for a revenue growth of 20% and a margin expansion of 150 basis points on year for the ongoing fiscal. Meanwhile, Anand Rathi Shares and Stock Brokers recommended accumulating the stock in the INR 4,450-INR 4,550 zone and said short-term dips may offer opportunity for its target of INR 5,725.

On Friday, the BSE Capital Goods index closed 1.2% higher at 70243.36 points, after three consecutive sessions of declines. Over the week, the index rose only 0.7% while the BSE Sensex was up 1.6% during the same period.

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Following are the resistance and support levels for the stocks for next week as per calculations by Informist based on their prices on the National Stock Exchange:

End

Reported by Shakshi Jain

Edited by Ashish Shirke

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