Bull's Eye: Short SAIL, IDBI Bank; buy Tata Motors

CNBC-TV18 brings you a brand new week of Bull's Eye. It's the popular game show where market experts come together to dish out trading strategies for you to make your week more exciting and compete with each other to see whose portfolio is the strongest.

Remember these are midcap ideas not just for the day, but stocks that look attractive in the medium-term as well.

This week, Aashish Tater, Fort Share Broking, Rakesh Gandhi, LKP and Nooresh Merani, AMSEC Research battle it out for top honours.

Below their top stock picks and analysis:

Aashish Tater, Fort Share Broking

I am going to short SAIL for a target of close to Rs 89 odd mark. We have been maintaining negative view on SAIL and looking at its quarterly and year-end performance, we feel there will be further downgrade on the stock. We have neutralized our targets from Rs 55 odd levels to Rs 64.50 for the stock, however we feel the steel cycle would bottom sometime in the quarter one end, thus from next 30-40 days perspective SAIL could be a very good short.

I am going to short TTK Prestige for a target of Rs 2,600. We have been maintaining our negative view on the stock right from the Rs 3,500 odd mark and we still feel there is lot of pain into the stock. Fundamentally, the valuations are too stressed and this could be one candidate where people should not go on short who are not professional traders but it is a better avoid at current levels.

VIP Industries has been a short from our side, because we felt at Rs 3,000 crore of market cap when the stock used to hover around at Rs 900 odd mark was terribly expensive and now with the stock has actually corrected to decent levels we still feel there is 10-15% downside onto the stock and the stock has broken its support of Rs 80 odd levels, thus one can go short on this stock with a closing stop of around Rs 82 odd mark.

I am going to short Reliance Capital for a target of Rs 288 odd mark with a closing stop of around Rs 308. This is one stock which on weakness goes terribly down. So a safer short when we expect that market could fall 40-50 points in today’s trade.

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Rakesh Gandhi, LKP

Century Textiles has been in a trading range between Rs 264-288 and hence building up a trading range on hourly charts. On Friday the trading range has broken on the downside indicating that stock could see further lower levels and hence can be shorted for a target of Rs 249.

Educomp Solutions has been seeing a strong downward momentum and has once again made a new low in the current downtrend, hence can be shorted for a target of Rs 128 with a stop loss of Rs 136.

IDBI Bank has been in a trading range forming a pennant kind of a formation on the charts. The stock has broken downward side in the pattern and could see lower levels and hence can be shorted for a target of Rs 80 with a stop loss of Rs 85.25.

Future Capital has been in a trading range since last five months and has been in limelight for its stake sell news. If the stock remains above Rs 135, the probability of an upward move rises and as soon as it crosses Rs 139 it could see a huge upward momentum, hence can be bought for a target of Rs 147 with a stop loss of Rs 134.75.

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Nooresh Merani, AMSEC Research

My first stock call is a sell on BGR Energy with an intraday target price of Rs 262 and a stop loss to be placed at Rs 281. The stock has broken the recent lows around Rs 280-285 levels and it has been in a downtrend for quite sometime. So we could expect given the fact that it’s a very high-beta counter to crack over the next few days. So this could be with a strict stop loss at Rs 281 and an intraday target of Rs 262 and maybe even towards Rs 250 in the short-term.

My second stock call is a sell on Jindal Steel & Power with a target price of Rs 410 in a day and a short-term target price at Rs 390. For the last many months Rs 450 was a base for the stock and Rs 600 is the upper end. The stock has recently broken below Rs 450 levels, so we could expect the stock to correct 5-10% from current levels. So it could be a sell at current levels with a stop loss at Rs 450.

My next stock call is a sell on Tata Steel with a target price of Rs 370 in the day and a stop loss to be placed at Rs 400. The stock is about to break the recent lows which is comparable to the 4800 low of Nifty, so we could expect some reaction over the next two-three sessions. So this trade could be with a view of two to three sessions.

My last stock call is a buy on Tata Motors with a deeper stop loss at Rs 210 and a target price at Rs 240. If we look at the stock, the last time it rallied from Rs 215-220 levels to up to Rs 300. So currently in the correction we could expect a retest of those levels and we could see good recovery from those levels. So any sharp dip in the morning could be an entry for the stock with a view of next two to three weeks.