Buy Dewan Housing, Shasun Pharma, Kalpataru Power: Lancelot

In CNBC-TV18's popular show Bull's Eye, Lancelot D Cunha of Sharyans Wealth Management shares his trading strategies for the day.

One may buy Dewan Housing Finance Corporation. Dewan Housing has recently been in talks to acquire the asset management stake in DLF from the joint venture of DLF Pramerica, the Life Insurance Company. The stock has corrected significantly from its highs and it is trading at about 1.25 times its book value. Looks fairly attractive from a valuation perspective and as the interest cycle eases up, one will start seeing better performance from the company. Hence, the target price of Rs 164.10.

One may buy Shasun Pharma with a target price of Rs 55.80. Shasun Pharma has recently settled its strike and with that we shall see the resumption of its manufacturing in the plant. It will also benefit from the depreciated rupee because of its major subsidiary operations in United Kingdom. From a valuation perspective it is trading at 11 PE and its book value is around Rs 50, so it is fairly attractive even on long-term perspective. For the day it should hit its target price.

One may buy Kalpataru Power. Kalpataru Power has recently received orders of about Rs 1000 crore and this should give a fillip to the company. The issue relating to the power sector slowly seem to be taking shape with the restructuring of debt of the State Electricity Board. Hence I believe that the power sector will start turning around and we shall see more traction for power transmission companies. I believe Kalpataru Power is well poised to take advantage of this move and hence a buy call at the current price.

One may buy United Phosphorous with a target price of Rs 139.50. United Phosphorus has corrected significantly from its highs at Rs 160. The stock is now moving up on increased volumes. We expect that this quarter should be a good quarter given that the rains have been good and we shall see benefits for the agro chemicals companies. It is trading at 7 times its forward earnings. I believe it is an attractive price to pay for a company like United Phosphorus with global operations. Given the short-term momentum it should hits its target price of Rs 139.50.