Buy BOI, Aurobindo Pharma, Alembic Pharma, Arvind: Kant

In CNBC-TV18's popular show Bull's Eye, Dharmesh Kant of India Nivesh Securities shares his trading strategies for the day.

One may buy Bank of India (BOI). They posted a very good set of Q2 numbers when compared with other PSUs. They were able to grow their business, at the same time, the asset quality improved, around 29 percent of growth was seen both in deposit advances and the gross NPAs along with net NPAs coming down on a sequential basis. Currently, it is trading at 0.55 at its price to book value and this is on a discount of 20-21 percent of its normal bank. Hence a buy call on BOI for a price target of Rs 230 keeping a stoploss at Rs 210. One may buy Aurobindo Pharma. The stock has posted a stellar set of numbers and going forward for next couple of years, we think that the current run rate is to be maintained on its formulation business. Post the US FDA clearance of unit 4 and unit 6, now the margins are being restored and before next couple of years, it is likely to be so. Currently it is available at around 25-30 percent discount on a P/E multiple which is one-year forward when compared to its largecap peers. Hence a buy call on Aurobindo Pharma for a price target of Rs 320 keeping a stoploss at around Rs 297. One may buy Alembic Pharmaceuticals for a price target of Rs 215 keeping a stoploss at Rs 197. Alembic Pharma posted a stellar set of numbers and in last three-four quarters it has been doing so. We believe the continuity of the trend for the next couple of years for Alembic Pharma post the synergies and the new product offerings, which they have launched, new complex molecule filings are high margin business. The benefit of which is likely to come in the coming one and a half years. Hence a buy call on Alembic Pharma for a price target of Rs 215 with a stoploss at Rs 197. One may buy Arvind for a price target of Rs 145 keeping a stoploss at Rs 127. It posted a very good set of Q2 in FY14 numbers and in the last six quarter numbers on a sequential basis, it looks like a turnaround story. Management sounded very bullish on the textile division and I think the later half of current financial year, we see a positive bottomline contribution from the branding and retail business as well as real estate division, which has been recently launched is going to contribute to the bottomline.