Buy Apollo Tyres, says Amit Gupta

Buy Apollo Tyres with one or two months perspective and hold on, says Amit Gupta, Head- Derivatives, ICICI Direct.

Gupta told CNBC-TV18, "In the last few sessions we have seen some buying has come up in the tyre space. They had seen some long liquidation before. If you look in the last two or three months, Apollo Tyres moved up from Rs 78 to Rs 105 and then it has given up almost 60-70% of the move and now it is trading at a very important retracement level of the whole move around Rs 185 to Rs 86 levels.”
He further added, “The open interest from the month of February if we see it is one of the highest now in this month. In fact in the month of October it surges by almost 52%. It gives me a sense that there has been lot of shorting in the stock that took place from Rs 105 to Rs 85 but because it has come down to a very good level there maybe a scenario of some short covering coming up.”
“I have seen before that Rs 80-84 is the range where the cash buying also happens in the stock, so far I haven’t seen that much of great cash buying happening but I have a sense, my gut feeling is that may start happening very soon in the stock. So, one can buy the stock for one or two months perspective and just hold on, I think it can give you some good money."