Buy Tata Power; target of Rs 98: ICICIdirect.com
ICICIdirect.com is bullish on Tata Power Company and has recommended to buy the stock in the range of Rs 84-80 for a target price of Rs 98 with a stop loss below Rs 76 on a closing basis, in its December 05, 2013 research report.
December 06, 2013 / 12:14 IST
ICICIdirect.com report on Tata Power Company
The share price of Tata Power Company has been seen in a consolidation mode for nearly 10 weeks. Recent price activity, however, signals a change of trend from bearish to bullish over the medium term. The significant observation on the price chart of Tata Power is the faster retracement of the last falling segment (82 to 70) in September 2013. The price decline in the last week of August from Rs 81 to 70 consumed nine trading sessions while the same was fully retraced in five trading sessions as the stock made sharp bounce off lows of Rs 70. This was a first major signal of change in sentiment after a prolonged decline during January–August 2013 (Rs 112-70). Subsequently, over the past two and a half months the stock consolidated in the price range of Rs 84-77. Importantly, the entire consolidation rested above the 50 percent Fibonacci retracement (Rs 77) of the September rally (Rs 70-85). During the current week, the stock price is seen piercing through the higher range of the consolidation at Rs 84 signalling the end of consolidation and resumption of bullish momentum. This break out also coincides with the breach of the downward slopping trend line (at Rs 83) connecting the peaks of January 2013 and July 2013.Post break out from the recent 2 ½ month consolidation, we expect the stock price to move towards Rs 98 projected on the basis of range of first rally off September lows (70-84 = 14 points) as measured by the break out level of Rs 84 indicating an upside toward Rs 98, which also coincides with the July 2013 highs of Rs 95.Strategy: Buy Tata Power in the range of Rs 84.00-80.00 for a target of Rs 98.00 with a stop loss below Rs 76.00 on a closing basis.Disclaimer: 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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