RPL better bet than RNRL: Madan

Madan told CNBC-TV18, "Reliance Petroleum is definitely a better bet than Reliance Natural Resources any day. At one point of time both were hovering at same prices. But at the same time I would say since RPL into news and still a darling of many investors and traders suddenly whenever there is a positive spike or good days in the market it tends to become overbought and then hence gets corrected also."

He further added, "But I would say that it is one of the stock which has consolidated post January fall but one has to keep trading in the stock but it gives good momentum at times and at the same time inherently their fundamentals are much better because their gross refining margins are one of the best in the industry even better that of from Reliance also and as long as the crude prices are up they will continue to reap that benefit and the production can start any moment; soon we will have that news."

He further added, "RNRL whenever one sees some positive spike and 10-20% jump from these one must get out and switchover to other stocks. In RNRL there are four business models; all four business models are long-term and I don’t think so there is anything fundamentally going to change the fortunes of the company in the immediate future as valuations at higher price at 20,000 much ahead than the fundamentals."

Disclosure: The analyst does not has a personal holding but may have recommended some of the stocks discussed today to his clients.