Neyveli Lignite has target of Rs 250: Pandey

Excerpts from Markets Midday on CNBC-TV18 Watch the full show » ALSO READ See previous views by Sudhanshu Pandey See what other Experts & Brokerages are saying about Neyveli Lignite See messages about Neyveli Lignite Neyveli Lignite BSE | NSE 10/02/12 Are Mutual Funds betting on Neyveli Lignite?

Neyveli Lignite has target of Rs 250, says Sudhanshu Pandey , Technical Analyst at LKP Shares.

Pandey told CNBC-TV18, "If you look at the Bombay Stock Exchange (BSE) the public sector undertaking (PSU) index is outperforming the BSE Sensex by big margin and it's been a steady outperformer. If you look at Neyveli Lignite & RCF there has been very interesting volume activity. These stocks were consolidating for several months for instance Neyveli was consolidating below the Rs 144-147 mark for many months and last week ending 13th November, we had Neyveli shooting up with abnormal volumes with 368 lakh shares traded during that week, huge volume breakout, followed by a gradual drift down. Very similar pattern was seen in RCF. So this is typically a build-up which happens before an extended move and that's why for medium to long-term player somebody who is interested in holding it for at least couple of months maybe for six-eight months also these two stocks provide very good opportunities where the downside risk is very little and huge upside potential looks to be on the charts."

He further added, "If you are looking at a bigger picture, I would look at Rs 250 as a potential target for Neyveli within six-eight months time and for RCF, I would be looking at Rs 120 in a six-eight months time."

Disclosure: We and our clients would have a position in the above stocks.