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Mar 16, 2017 04:43 PM IST | Source: CNBC-TV18

Buy Larsen & Toubro, Godrej Consumer may test Rs 1750: Amit Gupta

Amit Gupta of ICICIdirect is of the view that one can buy L&T while Godrej Consumer may hit Rs 1750.

Amit Gupta of ICICIdirect told CNBC-TV18, "The capital goods space, so far had not participated much in the market. Larsen & Toubro (L&T) has moved beyond Rs 1,500 and I think it is moving towards Rs 1,650. So, once the heavyweight has started performing, I think the other stocks from this space can start performing well. If we can combine with the power space, capital good segment is buzzing a lot more, like Siemens. It has consolidated near Rs 1,200 level for a pretty longer period. In fact in the recent quarterly results, it had made a high near Rs 1,250 and then it came down towards Rs 1,200 levels and there was almost one year high volumes we saw near Rs 1,200. Since then, for three or four weeks it has spent there and now this move has started. I think this move should take Siemens towards Rs 1,340-1,350 also looking at the base creation near these levels. So, this is one stock we are recommending to our clients on the long side." 

"Another one from the consumer space, Godrej Consumer has remained near the life highs, but it has spent almost five or six months now, so, that means whosoever has tried to go short during this period because the stock did not fall, that particular short, now is likely to be covered. So, the stock is likely to move up," he said.

"Godrej Consumer comes into that category because Rs 1,600 was a level since the month of October or September, the stock has been consolidating there and now in this particular move because that was a very critical resistance, almost 70 percent of short creation we saw when the stock was moving towards Rs 1,600 levels. So, I think once it is above that, and almost one year high volumes again are seen near Rs 1,600 in the stock, it is possible it can be a good short covering candidate for the March expiry. So, we are looking for a target of Rs 1,750 in the stock."
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