The Indian benchmark indices, the Senex and Nifty 50 have recovered over 6 per cent each from their lows made earlier this month. That gives an early indication that the 16 per cent corrective fall from the September 2024 highs in the benchmark indices may have come to an end. From a long-term perspective, there are good chances to see a fresh rally over the next couple of years in the Indian markets. However, the rise that will happen now may not be as sharp and fast as was seen during previous rallies in the past five years.

From the Covid-low of 25,639 in March 2020, the Sensex made a stellar 235 per cent rally to mark a new high of 85,978 in September 2024. During this rally, sectors such as Industrials and Capital Goods outperformed the benchmark index to a greater extent. The BSE Industrials index skyrocketed 864 per cent and the BSE Capital Good index surged 671 per cent. BSE Power (586 per cent), BSE Realty (583 per cent), BSE Metal (544 per cent) and BSE Auto (516 per cent) were all up over 500 per cent each.

This clearly indicates that there is always a greater opportunity to make excess returns outside the benchmark indices. Picking and investing in the right sector can help not only beat the benchmark indices, but give a multi-fold return too.

Here, we give four sectors that are looking impressive to be invested in the next multi-year bull run in the Indian markets. Please note that all the indices are selected purely based on charts using the technical analysis technique. Considering the availability of historical data, we have chosen all the sectoral indices from the BSE.

We have recommended two stocks for each sector. These stocks are selected based on charts and technical analysis and they are the index components. There can be unexpected winners outside the index as well. For those who wish to trade the indices, the exchange traded funds (ETFs) available are also mentioned.

For both the stocks and ETFs given, the levels mentioned for the respective index can be used as a proxy for entry, exit and stop-loss.

Investors have to do their own due diligence before entering into any stock. Proper risk management in the form of stop-loss is a must.

BSE Fast Moving Consumer Goods (FMCG) (19,477)

The BSE FMCG index has been rising well since the beginning of this month after a making a low of 18,198.68. This rise is happening after a sharp 25 per cent fall from its high of 24,109.51 made in September last year.

The recent bounce is very significant because it is happening from near some important supports. A strong trendline support is around 18,000, The 38.2 per cent Fibonacci retracement support is at 18,143. So, the bounce indicates that a bottom could be in place for now. Resistances are at 20,000 and 20,200. A strong monthly close above 20,200 will confirm the trend reversal. It will then take the BSE FMCG index up to 25,500-26,000 over the next couple of years.

In case the resistance at 22,200 holds for now, there are good chances to see a sideways move between 18,000 and 22,200 for a month or two. Thereafter, the rally to 25,500-26,000 can happen.

The bullish view will go wrong if the BSE FMCG index declines below 18,000. In that case, a fall to 16,600 can be seen.

What to do? Investors can enter BSE FMCG index at the current levels of 19,477. Accumulate on dips at 18,400. Stop-loss can be kept at 17,400 for the target of 25,500.

Stocks to watch: Godrej Consumer Products, Emami

ETFs available: ICICI Prudential Nifty FMCG ETF

BSE Consumer Durables (54,381.55)

In January, when the BSE Consumer Durable index was trading at 60,471, we had given a sell. At that time, we had forecast a fall to 55,200 and 53,500. This fall has happened in line with our expectation. The index touched a low of 52,258.33 and has bounced from there. After this fall, BSE Consumer Durable index looks attractive on the charts. It could be getting ready for a strong rally in the coming months.

Supports are at 52,500 and 51,000. On more leg of dip to test 51,000 on the downside cannot be ruled out. However, we expect the BSE Consumer Durable index to sustain above 51,000 and a fall beyond it is less likely.

Resistances are at 60,000 and 65,000. A strong rise above these resistances can take the BSE Consumer Durables index up to 78,000 initially and then 83,000 eventually over the next couple of years.

The view will go wrong if the BSE Consumer Durables index breaks below 51,000. Such a break will be bearish for a fall to 44,500-44,000

What to do? Investors can enter this index in two tranches. Buy now at the current levels of 54,381 and then accumulate on dips at 51,400. Keep the stop-loss at 48,800. Exit half of the holdings at 78,000 and the balance at 83,000.

Stocks to watch: Aditya Birla Fashion & Retail and Just Dial. Although these two stocks are not completely termed as consumer durable, among the index components, these two look good.  

BSE Metal (30,824.72)

In January, when the BSE Metal index was at 28,271, we had given a buy on it. At that time, we had said that 25,300 is a strong support and a fall beyond it is unlikely. The index fell to a low of 26,752 in January and has risen sharply by about 15 per cent already.

The movement since April 2020 is in the form of a bull channel. The recent surge is happening from just above this channel support. That keeps the channel movement intact.

We reiterate a buy in this index again. Strong supports are at 29,600-29,300 and then at 27,500-27,000. We retain our bullish view of seeing a rise to 40,000-41,000.

Intermediate resistance is at 32,500. A break above it can take the BSE Metal index up to 35,000 initially. An eventual break above 35,000 will then clear the way for the target of 40,000-41,000.

The bullish view will go wrong only if the index declines below 27,000. That will drag the index down to 24,000 and lower. But such a fall appears unlikely.

What to do? In January, we had recommended to buy at 28,271 and 25,800. The stop-loss was at 23,800 for the target of 40,000. This can be retained.

Those who have missed that can enter now at 30,824 and 30,400. Keep the stop-loss at 26,700 for the target of 40,000.

Stocks to watch: Hindalco Industries and Steel Authority of India (SAIL)

ETFs available: ICICI Prudential Nifty Metal ETF and Mirae Asset Nifty Metal ETF

BSE Oil & Gas (25,500)

The BSE Oil & Gas index has tumbled 34 per cent from its peak of 33,309 made in September last year. The index has now risen back sharply after making a low of 21,950 earlier this month. That gives an early indication that the fall could have ended.

Immediate support is at 24,800 and 24,000. Below that a strong trendline support is at 21,600. The BSE Oil & Gas index is looking bullish to see a rise to 36,000 and 39,000. Intermediate resistance is at 27,200. If this holds, a sideways consolidation between 21,600 and 27,200 is possible for a month or two and then the rise to 36,000-39,000 can happen over the next couple of years.

The index has to fall below 21,600 to negate this bullish view, which looks less likely now.

What to do? Investors can enter now at 25,500. Accumulate on dips at 23,400. Keep the stop-loss at 19,700 for the target of 38,000.

Stocks to watch: Reliance Industries and GAIL (India)

ETFs available: ICICI Prudential Nifty Oil & Gas ETF

Published on March 29, 2025