Buy Apollo Tyres, IFCI, Jain Irrigation: Tater

In CNBC-TV18's popular show Bull's Eye, Aashish Tater, FortuneWizard.com shares trading strategy of the day.

I am going long on Apollo Tyres for a target of Rs 92 with a closing stop of Rs 83. The rationale behind recommending this particular stock is that the stock input prices have gone down significantly, almost 8-10 percent mark-to-market down from last quarter. This could be a very important bet because almost 60 percentage plus of the total raw material cost is because of the input prices on rubber. So, this could easily see a re-rating on this particular stock and we are working with a target of close to 105 from medium-term perspective.
 
I am going long on IFCI for a target of Rs 37.50 and an eventual target of Rs 45 for this particular stock from short-term perspective. The stock faces a mild resistance which could act as a significant resistance around the Rs 37.8. But the way the market buzz is on IDBI getting merged with IFCI and the way both the charts are moving in tandem we feel there is a likely possibility of a book value merger which could be very much in favour of IFCI given that it is a holding company and adjusted price could be atleast Rs 45 plus on this particular stock.
 
I am going long on Karnataka Bank. Media has reported that there is a likely possibility of this particular company getting merged with ICICI Bank. We are working with a price to book value adjustment of Rs 1.7 times on conservative side to 2 times. Now, if you project ICICI stock with Karnataka Bank we feel the marginal ratio would be either 541 or 441. So, on either side if this news comes out to be true the likely possibility that the stock would go and test at Rs 211 mark first of all and even a possible target of Rs 235 with a closing stop of Rs 170
 
I am going long on Jain Irrigation with a closing stop of Rs 68 and a target of Rs 75. There are major developments at least expected and if anything of that sort happens on this particular stock, the stock can easily get rerated to that Rs 80 mark. However a positional stop of Rs 68 is required on this particular stock because below this the stock on technical chart goes very weak.