Bull's Eye: Short IDFC, Pantaloon; Buy M&M, Bata

CNBC-TV18 brings you a brand new week of Bull's Eye. It's the 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, Ashish Kapur, Investshoppe, Lancelot D'Cunha, Sharvans Wealth Mgmt and Madhumita Ghosh, UNICON battle it out for top honours. Below their top stock picks and analysis: Ashish Kapur, Investshoppe
My first call for the day is a short position on JSW Steel. The company is in a very tough situation after the Karnataka Government ban on iron ore mining. The company has further problems on account of its port of coking coal. The huge unhedged forex positions which also is resulting in a loss in the near-term. So for the moment this is one company where the problems are enormous, so we expect this stock to remain under pressure. For the day though we have a target of 540 with a stop loss at Rs 580.
My second call for the day is a short position on IDFC. This is another company where the news flow has been very negative of late. The loan disbursements and sanctions have also gone down significantly. To diversify their earnings stream the company had gone into asset management as well as investment banking business. But hereto the going is very rough.
My third call for the day is a long position on Bata. This is one company which is still doing very well. It is kind of captures the consumption story going on in India. The company has very low debt, very strong cash flows, is expanding in a very significant way. The turnover is expected to multiply in the next three-four years. So we remain upbeat and we think that this is one stock which investors can buy very safely in this market. For the day though we have a target at Rs 600 with a stop loss at Rs 550.
My final call for the day is a long position on Tata Metaliks. The company has not been doing well over the last couple of quarters but we expect a significant improvement going ahead. Softening of iron ore prices helps this company which is majorly into production and marketing of pig iron. Also their plant at Redi in Maharashtra is closing down and they are trying to get rid of this investment which has been kind of a drag on their performance for many years now. So this is a stock with very limited downside and has good upside potential. For the day we have a target at Rs 80 and a stop loss at Rs 69.
_PAGEBREAK_ Lancelot D'Cunha, Sharvans Wealth Mgmt
I have a buy call on Cummins India with a target price of Rs 349.90 and a stop loss of Rs 336. Cummins is a market leader in Euro III compliant diesel generator sets and power backup systems. In spite of the difficult environment we still find that Cummins will maintain its topline sales growth of 5% though it may have a compression of margins by about 400 bps. Cummins is presently trading at about 16 times its FY13 earnings, which is fairly attractive from a long-term perspective. Given the fact that Cummins had fallen a little bit during the last two-three days I felt that the momentum could take it to its target price.
I have a buy call on Tata Power with a target price of Rs 93.80 and a stop loss of Rs 90.10. Tata Power has been operating in a difficult environment with increase in coal prices however this should get partly offset by its investment in Bumi Resources which is a captive coal project in Indonesia. There are also some talks that Tata Power is in negotiations or in talks to try and review the tariff on its 2000 megawatt Mundra Power Project which if it happens could be an upside trigger for the company.
My third stock in the portfolio is I have a sell call on Zee Entertainment with a target price of Rs 114.50 and a stop loss of Rs 119.10. Zee Entertainment presently trades at an EPS of 25 times its FY13 earnings and with the deteriorating economic situation, I believe it will be difficult for Zee Entertainment to maintain its earnings growth and momentum. Pantaloon Retail is presently trading at 46 times its FY12 earnings which are fairly above its fundamentals considering the fact that the economic environment for retail is looking extremely difficult. Because of increased working capital margins are under pressure and that could bring the price down more in line with fundamental valuations.

_PAGEBREAK_ Madhumita Ghosh, UNICON Mahindra and Mahindra has shown some drag in the tractor division, which we expect in the near future to improve and that has been in the price in the last few days, which it has come down to Rs 650 levels. However, for the day target we expect it to move up to Rs 670 levels with a stop loss of Rs 640 basically because it is showing a positive sentiment and the oscillators and RSI is in the support zone with oversold region.
Second stock which we will be talking about is CESC which is again in the oversold region oscillators also. The government is expected to send a notification on the cabinet approval of the 100% FDI in single brand. So we expect CESC to move up to Rs 230 levels as the target for today and the stop loss being Rs 208.
The third stock is Uflex, which is in the packaging industry, which is expected to do well in the near future. The stock however has shown a golden crossover in the 5 to 20 day moving average with a positive sentiment and volume so we expect it to move up to Rs 125 as a target price with a stop loss of Rs 111. Tata Chemicals is showing good performance with the subsidiaries Rallis India and the mining subsidiary contributing to the profit and also the soda ash business is doing well. Again technically it seems that it will move up to Rs 330 levels with a stop loss of Rs 310, the main reason being that it has already covered the 20 day moving average with a positive sentiment and volume. So we expect the target price for today to reach around Rs 330.