Book profit in DCB around Rs 49-50, says SP Tulsian

SP Tulsian, sptulsian.com advice traders to book profit in DCB around Rs 49-50.

Tulsian told CNBC-TV18, “DCB have been posting the good numbers. In fact if you see for last 3-4 quarters continuously the asset quality has been improving, but for last may be 6-8 months we have been seeing that stock is seeing a strong resistance at about Rs 50 or so.”
He further added, “When we saw first quarter results coming in that time also the market cheered the results but if you see the valuations with 80 branch, market cap of close to about Rs 1000 crore or may be Rs 950-1000 crore the branches are valued at close to Rs 12 crore per branch which seems to be quite high because there used to be a trigger that this bank is seen as a takeover target by HDFC Bank and they are only waiting for the improvement in the performance and the asset quality of the bank which gradually is happening. So, traditionally the stock has been ruling quite expensive and for the last one year or so or may be 6-8 months or so it has not been able to move past Rs 50. So, the profit booking can come again at those levels Rs 49-50 and we will see the stock correcting.”
“HDFC Bank, they have been the consistent performer and in fact we have see for may be last four years the continuous growth of 30% on y-o-y basis is seen from the bank and that’s the reason it is the most expensive stock on a price to book also it is ruling at 4X. So, I don’t think that there is any kind of complaint or disappointment from HDFC Bank and the same trend, same trajectory of the performance one can expect from the next 4-6 quarter from HDFC Bank.”