Why are paper stocks skyrocketing? Experts recommend buying these stocks

Stocks to buy on Monday: Stock markets around the world are under pressure due to geopolitical tensions and soaring inflation. However, despite the Russian-Ukrainian war and commodity prices rising to multi-month highs, paper stocks in India have performed exceptionally well over the past month. Over the past month, West Coast Paper Mills stock price has risen around 25%, JK Paper shares have soared over 30%, Orient Paper & Industries stock price has climbed more than 14%, shares of Ruchira Papers jumped nearly 15.50% while Pudumjee’s stock price rose nearly 16.50%.

Stock market experts say paper mills are the least affected by recent global triggers like the war between Ukraine and Russia, soaring crude oil prices and other commodity prices hitting multi-month highs . In fact, the unlock theme has fueled demand for materials as schools and other educational institutions now reopen. Recently, prices for pulp and waste paper on international markets have increased, which could provide profit margins for paper mills in the coming quarters. They advised positional investors to add paper stocks like Orient Paper, West Coast Paper, JK Paper and Andhra Paper for 3-6 months.

Speaking on the reasons fueling the rally in paper stocks; Avinash Gorakshkar. The head of research at Profitmart Securities said: “The reason for the rise in paper stocks can be attributed to the bulls heading towards these stocks over the past month as these companies are the least impacted by geopolitical tensions and the surge in inflation. In fact, they use pulp and waste paper, the prices of which have been rising lately. Thus, the market expects the paper mills to benefit from the rise of these raw materials that they use as they have huge unsold stocks of pulp and waste paper.Apart from this unlocking theme, it is also working in favor of paper mills as the demand for paper has swelled moved north after the reopening of schools and other educational institutions.”

Stocks of paper to buy in the medium term

Avinash Gorakshkar of Profitmart Securities went on to add that such developments should continue to benefit paper mills over the next one to two quarters and therefore one can add paper stocks to one’s portfolio for the next 3 to 6 months. He said quality paper stocks like Orient Paper and West Coast Paper can be a good option for positional investors as these stocks are available at a discount these days.

Stocks to buy in the short term

On which paper stocks to buy today; Anuj Gupta, Vice President of IIFL Securities, said, “One can buy JK Paper shares at the current market price for a short-term target of 335 levels each holding the stop loss at 290 per action level. Those interested in Orient Paper shares can initiate a dynamic buy at CMP for a short-term target of 40 hold stop loss at 27. Similarly, shares of Andhra Paper can be purchased at the current market price for a short term target of 320 keeping the stop loss at 255 levels each.”

Warning: The opinions and recommendations made above are those of individual analysts or brokerage firms, and not of Mint.

To subscribe to Mint Bulletins

* Enter a valid email address

* Thank you for subscribing to our newsletter.

Never miss a story! Stay connected and informed with Mint. Download our app now!!

About Nicole Harmon

Check Also

This small company with a 14,000% gain overtook Goldman Sachs and other big companies

The world, apparently, has a new financial giant. The world, apparently, has a new financial …