Buy MphasiS, NIIT Tech, Escorts; sell Andhra Bank: Mukadam

In CNBC-TV18's popular show Bull's Eye, Shahina Mukadam of Varun Capital shares her trading strategies for the day.

One can buy MphasiS with a target of Rs 412. The stock is going to benefit from depreciation of the rupee. The M&A activities surrounding the stock, news flows with HP is likely to move out. Valuations are not expensive. It is as of now EV 1 time sales which is likely to see the stock bottoming out at current levels.
One can buy NIIT Technologies with a target of Rs 290. IT sector in my view should do better with the rupee depreciating and NIIT Technologies is one of the cheaper stocks in the segment with valuation of about 7 times one year forward earnings. Also with EPS growth expected on a CAGR basis of about 16-17 percent over the next 2-3 years it looks like an attractive bet at current levels.
One can buy Escorts with a target of Rs 74. Good monsoons is likely to be a very good positive for the stock as we saw in the last year. First half of the year revenues were marginally lower, but the company managed to maintain a good growth in profits on the back of improvement in EBITDA. Second half should be much better with volume sales of tractors moving up. Also the machinery division is doing pretty well as we have seen in the numbers in the last two months. Valuations are at around 8 times. Trailing Twelve Months (TTM) EPS is not that expensive for the stock.
One can sell Andhra Bank. We are likely to see some bit of a correction coming in the stock. It is in the overbought zone. Also in terms of valuation the stock while not too expensive at 0.8 times book has other problems in terms of the quality of the book. As we saw during the last year fiscal 13 there was a considerable deterioration in asset quality.