The range-bound Nifty is absorbing all sorts of selling pressure at this time, but will see a sharp rise if the index sees a monthly close above 6357, says Regan F Homavazir, Associate VP - Technical Research, Darashaw. His long-term target for the Nifty is at 7500.
He advises investors to buy Emami, which has a target of Rs 770 per share. He is also betting on United Spirits with a long term target of Rs 5040 per share. In the IT space, Homavazir is positive on Wipro with a target of Rs 717 per share.
Also Read: India to grow at 4.6%, world at 3.4% in 2014: IMF
Below is the verbatim transcript of Regan F Homavazir's interview on CNBC-TV18
Q: Give us your trajectory for the Nifty.
A: Nifty has been loitering at about 6300 since the last four months. We have been having a prognosis that the Nifty is absorbing all sorts of selling pressure at this time and the minute it gives you a monthly close above 6357, we are expecting it to accelerate. The acceleration is going to get us to 7500 so that is what we believe the Nifty is going to do.
Q: You have a long-term target on Emami at Rs 770 which is much higher than the current market price?
A: Emami is a stock that we believe that investors should get in because it has been not doing any uptick since the last three months. So we have been telling a lot of people that invest into the stock because the downsides here are limited so we are talking about a maximum downside of Rs 400 so as soon as you come closer to that value, we expect investors to get in. So the target does remain at Rs 700 plus so that is what we expect.
Q: In United Spirits (USL) you are giving a really huge target, tell us about the USL chart?
A: USL has been one of our top holdings right from Rs 2100 so we have been talking about it going to Rs 5000 and beyond since then. It has been moving very steadily on the upside and we expect that upmove to continue. Any declines that may happen in the interim should be only looked upon as buying opportunities and the stock should be bought into very heavily. It should be made one among your top 10 holdings.
Q: Is there a time limit to this Rs 5040 on USL?
A: Unfortunately at times you cannot predict the time element but however you could be witnessing that sort of an up move in about 24 months from now.
Q: You have a target of Rs 700 plus on Wipro?
A: Wipro and Infosys are among our top holdings in the IT space, these are our top recommendations. So Wipro we do expect that to happen and Infosys we expect about Rs 4900. We also like to state that HCL Technologies seems to be very stretched on its up move and we don't like the stock. So should you want to switch that HCL exposure in the IT space, Infosys and Wipro is the best that you can get.
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