Go long on Bank of India, Yes Bank, Rallies: Ashish Kapur

In CNBC-TV18's popular show Bull's Eye, Ashish Kapur of Investshoppe shares his trading strategies for the day.

First pick for the day is a long on Bank of India (BOI) with a target of Rs 315 and stop loss at Rs 287. The bank has reported fairly encouraging numbers. There is a significant increase in advances led by growth in the agricultural segment. The Net Interest Margin (NIM) has improved by 10 bps and most importantly the asset quality remains stable. The expectation of Net Interest Income (NII) growth over the next few years is very encouraging and also after the recent correction this stock is available at a very decent valuation.
Second pick for the day is a long on Yes Bank with a target of Rs 540 and a stop loss at Rs 496. We are expecting Yes Bank to further improve its distribution network and brand image, as the bank is continuing with its high interest rate offering on savings bank accounts. This bank is likely to be the biggest beneficiary of the deregulation of interest rates on savings bank account. Also the bank enjoys very good quality of assets and is expanding very rapidly, is growing at a very good pace.
Third pick for the day is a long on Sun Pharma Advanced Research Company (SPARC) with a target of Rs 175 and a stop loss at Rs 159. SPARC was hived off in 2007 from its parent Sun Pharma to focus on research and development of innovative drugs. The company has been growing rapidly, has got encouraging results over the last few years and most importantly in the last quarter it turned around and reported profit for the quarter compared to loss in the previous quarter. We feel that the kind of pipeline which the company has and the kind of parentage which it enjoys it is a great idea for the long run.
Final pick for the day is a long on Rallis India with a target of Rs 138 and a stop loss at Rs 126. Rallis reported very encouraging numbers in the previous quarter with a very smart increase in top-line and a 128 percent jump in EBITDA. Going forward, we expect this performance to sustain as the company is about to launch two new products. Also the environment for the industry remains positive. Rallis enjoys a very good brand image and a very nice distribution network.