Bull's Eye: Buy IVRCL, JK Tyre; short India Cement

Bull's Eye, CNBC-TV18's 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, Rajesh Agarwal of Eastern Financiers, Ashish Kapur of Investshoppe and Lancelot D Cunha of ITI Wealth Management battle it out for top honours. Below their top stock picks and analysis: Rajesh Agarwal of Eastern Financiers
We would like to recommend IVRCL for intraday buy with a target of Rs 68 and a stoploss of Rs 60. It has been in the news because of Essel taking stake in the company and later denying that they are not going to increase the stake or come out with an open offer, which saw the stock price crashing from levels of around Rs 75-80 right to Rs 60 levels. But at these levels I think the stock has become quite attractive and hence we recommend a buy.
The second stock in our list today is Kokuyo Camlin. Camlin which is one of the largest domestic brands in education sector in India from a very long time, recently Japanese company Kokuyo has taken a stake in this company. Jointly the company plans to take over its target to around Rs 1,000 crore in the next four years from its current revenue of around Rs 350 crore, which we believe is quite considerable considering the fact that it’s only Rs 350 crore at this point of time.
The third stock in our list today is Raj TV. One can buy this with a stop loss of Rs 152 and a target of Rs 170. It owns a library of more than 3,000 films which it plans to digitize which is going to add to the bottomline in a big way. Last quarter numbers were very good with around 87% jump in topline and around Rs 2 crore profit against a loss. Considering the fact that from July onwards compulsorily digitization is being done in some of the cities, the company has good prospects hence we recommend this as a buy.
The last stock in our list today is Essel Propack. One can buy this with a stop loss of Rs 32 and a target of Rs 38. FMCG companies like Colgate, etc are their main clients. It has fallen into bad times in the last two-three years, four years but now things are slightly looking as improved and we believe that going forward not only the Indian operations but their European and US operations are also showing improvement and this is going to add to the bottomline. Although topline has grown in the first nine months, bottomline has not grown but it’s just a matter of time when this stock gets re-rated. Hence, we recommend this as a buy.
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Ashish Kapur of Investshoppe
My first call for the day is a long position on Godrej Consumer Products with a target of Rs 550 and a stop loss at Rs 508. Clearly the focus of the company is very strong and this is already delivering good growth in both the top-line as well as the bottom-line. Since the company is not trying to diversify into any unrelated or any other segment of the FMCG space we feel that this growth will continue as new geographies will get added. So we have quite liked the company and we feel it’s fundamentally still a very good buy. Moreover in this market with the kind of turbulence which we are seeing FMCG is a safer space for investors to stay put.
My second call for the day is a long position on JK Tyre with a target of Rs 92.5 and a stop loss at Rs 85.5. Tyre industry is generally going through a good time now. The tough times are behind us and going forward we expect good companies in the tyre space to deliver very strong performance. Since two years is normally the retracement period for tyres especially the commercial vehicle tyres we expect the replacement market to be very strong going forward. So JK Tyre is also one company which can benefit from this trend.
My third call for the day is a long position on Alstom Projects with a target of Rs 430 and a stop loss at Rs 397. Reason for being bullish on this company is that this is one company catering to the infrastructure sector which enjoys very good technological support from its parent company. Also the company has been perfuming very well in very tough times. They have an order book of Rs 500 crore which they plan to implement over the next two years. We expect the growth momentum to continue at least on the top-line front.
My final call for the day is a short position on JSW Energy with a target of Rs 47 and a stop loss at Rs 52. The reason for being bearish on this company is that the entire power sector space is going through a very rough time and especially companies like JSW Energy which are operating on a non-integrated model. JSW Energy is dependent on imported coal for its fuel requirements which is a big negative in these times because coal linkages are very difficult to establish specially since various governments across the world are making it tougher for import of coal.
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Lancelot D Cunha of ITI Wealth Management
My first call is IVRCL. I have a target price of Rs 69. It has moved up on good volumes today in spite of the market being weak. I am sensing that the takeover battle is going on in the background and that is why we are seeing accumulation of the stock. I believe that it will go up given the current momentum and it should hit its target price of Rs 69.
My second call is a buy call on BF Utilities with a target price of Rs 445. The stock has been continuously being accumulated ever since the news of Anil Ambani selling his stake at a valuation of Rs 4,000 crore in the Nandi Infrastructure project which is a subsidiary of BF Utilities where they hold a 75% stake and since then we have been seeing accumulation. Over the past few days I have noticed this stock actually rising on good volumes. I think given the current momentum that I am seeing, I expect this stock to hit its target price of Rs 445.
My third call for the day is a sell call on GAIL with a target price of Rs 326. Since the court order on IGPL is awaited most investors are little bit apprehensive about holding onto GAIL where the government may have some controls and we may see some impact of the order coming back on the distribution charges that GAIL is charging from its customers. So the stock has been continuously seeing a selloff and I see that the momentum is on the downside given the selloff that we have seen in the last few days I expect this to continue going forward and we should see it hitting its target price of Rs 326.
My fourth call is a sell call on India Cements with a target price of Rs 82.10. India Cement actually had risen along with the rise in cement stocks and we have seen it fall off its highs on the back of news that there maybe a probe by the CCI (Competition Commission of India) on cartelization of cement prices. This is seeing some amount of unwinding on profit taking coupled with selling from investors who want to exit from the stock. Recently yesterday the company came out with its results which showed that its operating margins got negatively impacted with higher employee cost and this is negative for the company so I see that the selloff may continue.