Here are TS Harihar's top trading ideas

Larsen & Toubro

Larsen & Toubro (L&T) is another stock which is at an amazing sweet spot at this point of time. We do at times tend to get a little impatient that the capital cycle is not reviving but we need to give at least a year for that. Now assume that the capital cycle revives, let us also remember that this budget has put a lot of emphasis on defence spending and L&T is one of the companies to benefit substantially from defence spending. I would believe that both these things put together, L&T is at an extremely sweet spot. So we are looking again at intermediate target of Rs 2,000 and one quarter target of about Rs 2,200 in the stock.

Idea Cellular

We are slightly negative on Idea Cellular. The momentum has been quite strong on the stock but we believe that USD 4.5 billion that they need to pay out as spectrum fees is going to become a major overhang for the company and that is about Rs 27,000 crore. While the company is quite confident of transferring in the form of price hikes to consumers, I have my own doubts to what extent they will successful especially in a competitive market like this. At the current market price of Rs 185-190 we would definitely be slightly negative on Idea Cellular.

Sun Pharmaceutical Industries

In Sun Pharmaceutical Industries, there could be some element of consolidation because they have just completed the acquisition of Ranbaxy Laboratories and the entire fit would take some more time.

Lupin

However as far as Lupin is concerned, I think their focus on generic has worked well and over the last two and a half to three years, the stock has appreciated about five times. Even at these prices, the stock continues to look fairly attractive. So from a very short-term perspective, it is slightly hard to say but if you give one quarter’s leeway, I would believe that Lupin would still have about 20-25 percent upside from these levels.

Tata Motors

I would honestly prefer to stick to Tata Motors because Ashok Leyland has appreciated quite a bit. The margin of safety on Ashok Leyland seems to be quite limited. On the other hand, Tata Motors has corrected from about Rs 620 down to about Rs 530-540 and with Jaguar still doing so well and contributing so much, let us not forget that among all these large acquisitions that were made about five-six years back, JLR is probably the only acquisition that has made money for the Indian company.

We believe that at current prices, if I was to take a bet on the overall heavy vehicle space, Tata Motors would take precedence over Ashok Leyland at these prices. So I would definitely take a long bet on Tata Motors.