Sell Financial Tech; buy Tata Power, Pidilite: Agarwal

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

One can sell Financial Technologies with a stop loss of Rs 173 and a target of Rs 150. The National Spot Exchange Ltd (NSEL) fiasco and the continued default in payments has taken a toll on the stock moreover with yesterday’s controversy regarding the auditor’s comment that accounts are not reliable, would again put further pressure on the stock and hence a sell call. We believe that there are more downside to this stock but for intraday the stop loss is Rs 173 and the target is Rs 150.
One can buy Tata Power Company with a stop loss of Rs 78 and the target is Rs 84. The stock has seen quite a beating after Q1 numbers, which were very bad due to interest costs and forex losses but with yesterday’s coal policy announcements and the kind of momentum, which we have witnessed in the recent past in the stock, we believe that all the negatives are already been discounted and with CERC order regarding tariff hike spending; any positive announcements from that side would also be a big positive trigger.
One can buy Pidilite Industries with a stop loss of Rs 254 and target of Rs 265. This is a well known company in adhesive market and other chemicals not only domestic but they have presence in various countries like Singapore, USA, Brazil etc. They have diversified in various segments such as adhesives, construction and paint chemicals. So with strong brands like Fevicol and Dr Fixit, this company can grow well although it has been growing well for the last many years. Q1 numbers are quite attractive with around 26 percent jump in bottomline.
One can buy Ramky Infrastructure with a stop loss of Rs 50 and a target of Rs 55. Against the order book of USD 120 billion, the marketcap stands at Rs 295 crore, which is highly attractive. Moreover, the company aims at getting more order of around USD 20 billion in FY14. There have been headwinds with regarding stretched balance sheet and interest losses etc and slowing execution of orders but we believe that all the negatives have already been discounted and the valuations have become very attractive at 0.3 times price to book.