Buy Dena Bank, Allahabad Bank, Jain Irrigation: Merani

In CNBC-TV18's popular show Bull's Eye, Nooresh Merani of AMSEC Research shares his trading strategies for the day.

I have a buy call on Dena Bank. We continue to prefer PSU banks over private banks at current levels. PSU banks have underperformed for the last two-three years and the stocks are available at two-three year lows. Dena Bank has found a lot of support in the band of Rs 85 to Rs 88 over the last two-three years. The stock continues to bounce back from this zone, so we expect a medium-term target price of Rs 105 to Rs 110. One can accumulate the stock at current levels. Given the fact that the stock has sold off over the last few sessions we expect a small bounce back. A trade for that would be looking towards Rs 92 and stop loss at Rs 85.
I have a buy call on Allahabad Bank. The stock is available at a two year support wherein we expect the stock to bottom out around Rs 120 zone. One can expect the stock to bounce back towards Rs 128 and an intraday target price would be placed at Rs 128 and medium-term target price at Rs 160 plus with a trading stop loss at Rs 119.
I have a buy call on Jain Irrigation Systems. The stock has been on a sideway range for a very long time. But in the short-term it is making a flag pattern which has a breakout around Rs 70. Once that is crossed, we can expect a strong move towards Rs 80 also. This is a pre-emptive trade. One can keep a stop loss at Rs 64 and a target price of Rs 72.
I have a buy call on Gujarat State Fertilizers & Chemicals. The stock has been on a consistent downtrend and it has made a double bottom around Rs 54. One can buy the stock at current levels with a longer-term view as well. In the short-term the target price would be Rs 60 and longer-term target price at Rs 80. Stop loss to be placed at Rs 54.