Buy LIC Housing on decline to around Rs 270-275: Gupta

According to Amit Gupta of ICICI Direct, any decline towards the range of Rs 270-275 on LIC Housing Finance should be bought into and look for target of Rs 310.

Gupta told CNBC-TV18, “LIC Housing Finance is one of those stocks which are more short bias. I believe in the last six-seven months, it was consolidating in the range of around Rs 240 to Rs 270. Around Rs 240-250, we saw a lot of short creation happening and now after the breakout came, people are still averaging the short positions and this is evident in the open interest (OI), which is at an elevated levels even now. So, we are not seeing the closer in OI yet.”
“The 50 day moving average is also placed around Rs 275 and the higher band of the last six months is Rs 270-275. It is consolidating above this and the kind of fall one is seeing in the market during the intraday, one is not seeing that kind of fall happening in this stock. So, that may bode well with LIC Housing Finance,” Gupta added.
He said, “Any decline towards this range of Rs 270-275 should be bought into and look for target of Rs 310. Keep a stop loss below the average price of the last six months, which was at Rs 260, so one can keep the stop loss at Rs 255.”