Buy Nalco, Motherson Sumi; Sell Adani Ent: Cunha

In CNBC-TV18's popular show Bull's Eye, Lancelot D Cunha of ITI Wealth Management shares trading strategy of the day.

Buy National Aluminium Company (NALCO) with a target price of Rs 47.40. NALCO has moved up yesterday on the news that its follow on public offer (FPO) maybe postpone and given that news I expect to see some short covering on the stock and with the increased volumes we saw yesterday, I expect today also to see similar volumes and that could take the stock up to hit its target price of Rs 47.40.
Buy Motherson Sumi Systems. Motherson Sumi has recently announced plans that it plans to do a qualified institutional placement (QIP) but pricing has not been finalized. However, the fact that they will be going for a QIP has been seeing increased volumes in the stock with increased movement in price given the higher delivery quantity is that we have been seeing take place in this stock. I see this trend likely to continue a bit and it could move inline with markets to its target price of Rs 210.
Sell Adani Enterprises with a target price of Rs 224.10. Adani Enterprises had risen quite a bit and last few days has been seeing reversing trends. The chart looks typically a little weak and with the accelerated selling that was visible in the volumes, I believe this stock could go down further to hit its target price of Rs 224.10.
Sell Power Finance Corporation with a target price of Rs 184.50. Power Finance was negatively impacted by the news that Punjab government may pullout the state electricity board (SEB) structuring. This move could create a bit of a problem for Power Finance’s non-performing asset (NPA) positions and that is seeing some amount of stress in terms of selling on the stock with increased volumes. Given the trend I expect this could go down further and could hit its target price of Rs 184.50.