Exit PFC, REC on minor rally, says SP Tulsian

One can exit Power Finance Corporation (PFC) and Rural Electrification Corporation (REC) on minor rally, says SP Tulsian, sptulsian.com.

Tulsian told CNBC-TV18, "The possibility of another power tariff hike is very positive news from the reforms point of view and you cannot allow the Discoms really go into the drain by continuously making losses and expect governments to come with relief package every eight-ten years."
He further added, "If you see its positive impact will be seen reflecting directly on Power Finance Corporation Limited (PFC), Rural Electrification Corporation (REC) because ultimately both are dedicated power financials. And yesterday also we have seen the news that Uttar Pradesh (UP) government is trying to borrow Rs 1500 crore each from both of these companies to pay the power suppliers. So obviously it will have a spiral effect once the health of state electricity boards (SEBs) improves then obviously the value down the line, the financiers, the power generators everything will stand to gain, so a very positive move."
"But PFC-REC have peaked out, may be 4-5 percent upside is seen from here on but I will be advising profit booking even to the investors because both these stocks are showing quite a good swing. They swiftly correct by about 8-10 percent. So exit in a minor rally of 2-3 percent more and look to enter on a correction of about 10 percent which is likely to come in next 15-20 days."