Buy Alembic Pharmaceutical, Dishman Pharma, NHPC: Agarwal

In CNBC-TV18's popular show Bull's Eye, Rajesh Agarwal, Eastern Financiers shares trading strategy of the day.

Buy Alembic Pharmaceutical with an intraday stop loss of Rs 87 and a target of Rs 97. The company reported strong numbers in Q3 with both margins and bottomline improving. Numbers improved post the restructuring that the management has carried out. We expect the profit after tax (PAT) to grow at around compounded annual growth rate (CAGR) of 17 percent in the next two years.
Buy Dishman Pharmaceuticals & Chemicals with a stop loss of Rs 67 and a target of Rs 73. This company is basically into vitamins, D3, which is in good demand. We expect this business to become a growth driver for this company because there are very few manufacturers in the world. Moreover it is likely to be benefited by the growth in contract research and manufacturing services (CRAMS) business. In Q3, the CRAMS business has grown by almost 24 percent and we expect this division to do well in the near future also.
Buy National Hydroelectric Power Corporation (NHPC) with an intraday stop loss of Rs 18.50 and a target of Rs 21.50. We have seen a huge carnage in this stock in the recent past due to various reasons other than fundamentals. The company has strong fundamentals. It is a government company, government holds around 86.36 percent. It reported 47 percent jump in bottomline in December quarter. With a book value of Rs 23 and an earnings per share (EPS) of Rs 2, with consistent dividend paying record, we believe that it is highly undervalued at this price hence a buy call.
Buy IndusInd Bank with a stop loss of Rs 404 and a target of Rs 418. This is one of the fastest growing banks in the private sector reported a 30 percent jump in bottomline in Q3. When the net interest margins (NIMs) stood at 3.46 percent as against 3.25 percent and these numbers were despite the fact that they have written off Deccan Chronicle’s losses. With the stock being included in Nifty from April 1, we believe that there would be a lot of buying from the index based funds also.