Cairn India a good short term bet, says SP Tulsian

Cairn India is a good short term bet for July series, says SP Tulsian, sptulsian.com.

Tulsian told CNBC-TV18, “Yesterday we have seen that the block deals or the major investors exiting from Axis Bank and Yes Bank and once we see that happening in fact maybe a month back which we have seen that happening in HDFC, Kotak Mahindra Bank for all these exit by the promoters firstly Cairn, PLC has the compulsion, they have to exit from the stock. They right now have put 3.5% stake on the block and still they will be left with 18% into the company which will keep happening.”
He further added, “Sometimes I only wonder whether what kind of agreement they had with Vedanta, was there no compulsion on part of them to acquire the remaining stake but if it is presumed that they need to sell that in the market in my view this remaining 18% stock will keep coming in the tranches and maybe the whole of next 12 months can keep the stock subdued and now this stock has double whammy, on one hand you have the falling crude prices which will keep the prices under check and if we keep these type of tranches coming for sale from Cairn, PLC again the prices will remain under check but yes the floor can be seen for the stock at Rs 300. I don’t think that the further stake sale will really be happening below that and one should look for an upside getting capped at about Rs 330, so it makes a good short term trading play in a tight range of about Rs 305-320 for the traders on a monthly basis, so this becomes a trading range for the stock atleast for whole of July series.” Disclaimer: I have holdings in HDFC Warrants. Other stocks discussed may have been recommended to clients.