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, Ashish Kapur of Investshoppe, Lancelot D'Cunha of Sharvans Wealth Mgmt and Madhumita Ghosh of UNICON battle it out for top honours.
Below their top stock picks and analysis:
Ashish Kapur, Investshoppe
My first call for the day is a long position on Patel Engineering. This is one engineering stock where the results are still pretty fine. This company is likely to go to escape this slowdown with a very limited downside of it. The company also has lot of advantages in terms of the urban technology which they employ. They also had real estate vision and they are likely to start booking revenues from the real estate division quite soon. Overall the company is available at a very decent valuation. For the day though we have a target at Rs 93 with a stop loss at Rs 85.
My second call for the day is a long position on Tata Motors. This is one company where the growth is happening very strong. Their national operations are really helping there. Even when the markets were on a weak note last month this is one stock which held out very well. With some kind of a pullback coming back to the market we can expect momentum to pick up in this stock. For the day we have a target at Rs 215 and a stop loss at Rs 198.
My third call for the day is a long position on Bharat Forge with a stop loss at Rs 271 with a target at Rs 310. This is one company where the export revenues are helping them to stay afloat, so their diversification into the non automotive business as well as their export focus is really helping this company to stay afloat. We expect momentum to come to this stock in the near future and therefore for the day we have a target at Rs 310 with a stop loss at Rs 271.
Final call for the day is a long position on Crompton Greaves. This is fundamentally quite a good company but last few quarters they have faced a huge pressure both on the revenue as well as the margin front. Due to this the stock has fallen a lot. In fact it has more than half of what it was trading a year back. We think that it is a very good time to accumulate Crompton for long term investor and with the market being in a pullback rally we expect some momentum to come into this stock in the near future. For the day we have a target at Rs 140 with a stop loss at Rs 127.
Lancelot D'Cunha, Sharvans Wealth Mgmt
Buy Yes Bank with a target price of Rs 271 and a stop loss of Rs 260. I believe that it is also a good bank which will come out with good numbers as we have seen IndusInd Bank also come out with good numbers. I expect that there will be some buying in Yes Bank in anticipation of the numbers that they will come out with. It presently trades at about 3 times its book value FY13 book value which is pretty reasonable for the stock.
Buy LIC Housing Finance. It is the second largest lender in the housing finance industry and I see it coming out with good growth on its numbers. A loan book growth of around 25% on its loan of Rs 5500 crore with a net interest margin of around 2.5%. Presently trades at about 2.2 times FY13 book value and I believe with the rise in market I was expecting that it should also see some upward momentum and I expected to hit the target price of Rs 237 with a stop loss of Rs 228.
I have a buy call on Wockhardt. The target is Rs 309.50 and a stop loss of Rs 296. It has recently been given approval for 2 more drugs, which actually can be good out licensing deals for Wockhardt; is also recently been able to settle its dues to creditors in terms of a set program. Hence I believe that Wockhardt will be a good stock even from the long term perspective and in the short run given the momentum that it had yesterday the stock moved up. I believe that it will move up further today and so it should achieve the target price.
Have a buy call on Crompton Greaves with a target price of Rs 135 and a stop loss of Rs 128. It had been beaten down on due to expectations that there will be low growth on its order book. However, what I see is that with Power Grid Corporation now starting to grant orders you will see some amount of order book addition on the domestic business for Crompton Greaves and as you see the economy improving you will start seeing Crompton getting re-rated. From a daily basis Crompton Greaves has been moving upwards and has some resistance at Rs 137. So given the good strong momentum I expect that Crompton Greaves would move up to target price of Rs 137 during the day.
Madhumita Ghosh, UNICON
Sintex has seen a downtrend in the stock price in the last three months mainly because of the slowdown in the overseas operations and also forex losses. The company, the management has been saying they will be able to make repayments for the FCCB which is due in FY13. We expect the stock price to move upto Rs 73 today with a stop loss of Rs 64.
Sell Ranbaxy. The company recently had a provision of USD 500 based on some US investigation and this will have an affect on their balance sheet. Otherwise there is no triggers in the short term in terms of approvals or launch of products, There is a candle stick pattern which is bearish, engulfing candle stick pattern in the stock price. So the target price is Rs 432 with the stop loss of Rs 447.
In Bharti Airtel there has been news about the concerns on spectrum and decisions with regarding them. There is a negative sentiment on the telecom sector. However, we feel that according to the fundamentals the valuation at present is compelling and the RSI and the oscillators are in the oversold region. We expect the stock price to move up with the target price of Rs 337 and the stop loss of Rs 324.
Buy Raymond. We see RSI cross over and they are all in over sold region and they are all supporting a positive uptrend on the stock. It has basically crossed over a crucial level of Rs 321 and we expect the target price to be around Rs 332 for today with a stop loss of Rs 314.