Bull's Eye, CNBC-TV18's popular game show, where market experts come together to dish out trading strategies for you to make your week more exciting and compete with each other to see whose portfolio is the strongest.
Remember these are midcap ideas not just for the day, but stocks that look attractive in the medium-term as well.
This week, SP Tulsian of sptulsian.com, Vishal Jajoo Of Nirmal Bang and Sharmila Joshi of Fairwealth Securities battle it out for top honours.
SP Tulsian, sptulsian.com
Buy KPIT Cummins with a day target of Rs 110 and stop loss of Rs 100. The positive call on the stock was given yesterday also and the management having hinted a growth of 30-35% in FY13 is likely to see the positive momentum continuing for the stock and hence a buy call.”
Buy Indraprastha Gas (IGL) with a day target of Rs 244 and stop loss of Rs 218. The hearing in Delhi High Court against the PNGRB (Petroleum and Natural Gas Regulatory Board) order is likely to be heard today and if Delhi High Court stays the retrospective demand of the PNGRB order that will be seen quite positive by the market and share is likely to witness renewed buying coupled with short covering.
Buy Sonata Software with a day target of Rs 22 and stop loss of Rs 19.70. The informed buying is seen in the stock ahead of its Q4 numbers which are likely to be considered very soon and apart from that this company having top-line of close to Rs 2,000 crore and share ruling at 50% of its book value is seen as a value buying by the informed circle.
Short Ashok Leyland with a day target of Rs 29 and stop loss of Rs 31.10. All the auto stocks have been showing weak trend because of the dull April sales number having posted by various automakers. Ashok Leyland is also likely to post the dull April sales number. Apart from that the share is ruling at a PE multiple of Rs 15 which is seen quite expensive when compared with Tata Motors and hence profit booking coupled with short covering is likely to be seen in the stock and hence a negative call.
Vishal Jajoo, Nirmal Bang
Buy Arshiya International with a target price of Rs 162.50. The company has pioneered the concept of setting a free trade warehousing zone in the country. This leads to not only savings in time but also logistics cost for the customer. The company’s first facility came in at Panvel last year and the second facility is being set up at Khurja with the third facility coming and it would be complete integrated warehousing structure. The business is still in the setup mode. The EBIT margins in the particular segment of warehousing is as high as 85% and with the integrated facility coming up not only in terms of revenues, but in terms of profitability also the company is expected to clock excellent set of numbers.
Buy Aptech with a target price of Rs 79.80. The company’s share price has basically declined by almost 50% from its 52-week and if one looks at the fundamentals, valuations, the numbers and the management. I think this is not warranted and with the results round the corner I think the stock can provide some decent upside in the short-term as well as medium-term.
Buy Allahabad Bank with a target price of Rs 172.80. A decent midsized PSU bank having relatively cleaner balance sheet. In third quarter concall the management has mentioned that it hardly has any exposure towards stressed areas. It has managed its asset quality very well, as a result of which even if one looks from a dividend perspective, the dividend which the bank gave last year was Rs 6. We think that this year it would be around Rs 7-7.5 from a dividend yield perspective. From a price-to-book value and earnings angle also the bank stock is relatively undervalued and therefore we have a buy call on Allahabad Bank.
Buy Balrampur Chini, though what is not happening as far as the complete decontrol in the sugar sector, but certain steps, maybe in bits and pieces are taken in that direction. So I think the two domestic companies which would be benefited on account of this are Balrampur Chini and Bajaj Hindustan. Looking at the balance sheet amongst the two companies Balrampur Chini is in a better shape and therefore we have a buy call from a trading perspective in Balrampur Chini.
Sharmila Joshi, Fairwealth Securities
Buy Future Capital with a target of Rs 138 and a stoploss at Rs 131. Future Capital has corrected along with Pantaloon but there is board meeting for Pantaloon and we have been hearing that there could be an investor that’s interested in Future Capital. This could mean good news obviously both for Pantaloon as well as Future Capital.
Buy ADF Foods with a target of Rs 61.50 and a stop loss at Rs 58. Once again some news of some potential buyout of ADF Foods by some investors. A stock that’s trading at reasonable valuations and even if you were to buy it with a slightly longer term perspective you could get targets of about Rs 76, but for the day I buy it with a target of Rs 61.5.
Buy Dena Bank with a target of Rs 97.5 and a stop loss at Rs 94.25. I do like midsized PSU banks at this point in time and I had recommended for Syndicate Bank yesterday. I think overall a good bank to start picking at banks, especially banks like Dena Bank where they are trading below one time their book value, so I think tremendous potential. Buy this and hold onto it for a period of seven to eight months, one could see a target of about Rs 120 on Dena Bank.
Buy Orchid Chemicals with a target of Rs 185 and a stop loss at Rs 179.50. The company has received a USFDA approval for migraine drug generic. I wanted to include a pharma name given how volatile markets are. So I picked up a momentum kind of stock in Orchid Chemicals.