Buy Havells India; target Rs 920: ICICIdirect.com
ICICIdirect.com is bullish on Havells India and has recommended buy rating on the stock with a price target of Rs 920 in its research report dated July 15, 2013.
July 15, 2013 / 13:20 IST
ICICIdirect.com's report on Havells India
In the current financial year, the Nifty has been broadly consolidating in the 5600-6100 range. In this period, from April 2013 to the current date, stocks from the FMCG and pharma space have bucked the trend and seen gradual upsides. To put things in perspective, where the Nifty is up 5 percent since the April series, the FMCG Index has gone up over 17 percent. Most of the shorts, which were created in the Nifty in the June series, have been left to expire. As a result, the Nifty in the current series has staged a strong comeback towards 6000. It has set the stage for midcap stocks from these sectors to perform a catch up exercise. We believe stocks like Havells could see a fresh up move on the back of prevailing low leverage and delivery based buying.Havells India has been witnessing a gradual decline in open interest. In the April and May series, the stock had traded at a considerable discount and the open interest also started plummeting. This led to a fall from Rs 750 to Rs 670 levels. However, eventually these shorts got closed and the underlying recovered above Rs 750. We believe it is a good candidate for short covering in the coming sessions.The delivery volume has seen a sharp pick up in the stock during the July series in the range of Rs 750-780, which was higher than the delivery volume seen in the recent fall till Rs 670. Hence, we expect the current buying in the stock to take it to much higher levels.Havells has consolidated for eight months in the range of Rs 650-700 before breaking out in May, 2013. We believe such a good consolidation base formed in the stock may result in good upsides in the days to come.Recommendation:
Buy Havells India in cash in the range of Rs 752-772
Target: Rs 920
Stop loss: Rs 680
Time Frame: Three monthsDisclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. 
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