In analysis of the day's trading on CNBC-TV18, SP Tulsian of sptulsian.com, asks investors to wait till April 20 when the report of the Central Empowered Committee, appointed by the forest bench of the Supreme Court, will submit its report. He also calls Max India "boring" and advises exit of the stock as quickly as possible.
Below is an edited transcript of his interview on CNBC-TV18. Also watch the accompanying video.
Q: What do you make of this indecision of the Karnataka government in implementing the ban on mining and its impact on the stocks?
A: The decision will be clear on April 20, the date set by the Central Empowered Committee appointed by the forest bench of the apex court.
The committee has already submitted the report that in Category A, 45 mining companies should be allowed to restart and 49 leases have been recommended for cancellation. In Category B, 72 leases have been mentioned.
There is also a penalty of Rs 5 crore per hectare for Category C leases and penalty of Rs 1 crore per hectare for Category B leases has been prescribed.
So it's just a matter of time that the estimated amount of Rs 300 crore which is likely to get collected from this penalty will be used for restoration and reclamation of the cancelled leases.
I hope that that April 20 will be the final date. I think the bench is overloaded with the case and hence is unable to take a decision which has very far-reaching implications.
Q: How would you approach Max India after its 5.5% fall today?
A: I find this stock quite dull and boring. There has'nt been any kind of upside in the last one year or so. Only on the news of Max New York's stake sale of 26% and the company having gain Rs 870-880 crore in pre-tax profits, did the stock go up.
But generally that is a mistake short-term traders or investors make. They enter at the upper end whenever they see this kind of rally, and then they struggle and hold to see the cost. I do not maintain a positive view on the stock. Any rally above Rs 205-206 should be used as an exit opportunity.