"In the last week, the Nifty clocked the largest percentage weekly gain since April 2013. This has been mainly driven by sharp short covering in the banking and capital goods space. As the Nifty is showing price stability near record highs, some more stocks are likely to move up. Titan is one such stock, which may see upsides. The decline in Titan started in June 2013, on the back of short build-up and the stock felt sharply from Rs 300 to Rs 200 in five trading sessions. Since then, the stock has been trading subdued. In January, fresh short build-up was seen while the stock declined towards its one-year lows. The pullback move started towards the end of January as it moved above the key level of Rs 230, triggering short covering of nearly 10 percent in OI. With strong rollover of these short positions into the March series as well, we believe further short covering in the stock can be seen, which could allow it to head towards Rs 290 in the coming days"
"In the past two instances, it was observed that Titan had seen sharp pullback moves from Rs 200-210 towards Rs 275-290. In January 2013, the decline in the stock found support near the support zone and following its footsteps, it started witnessing a similar pullback rally. The recent move above Rs 250 has forced Call writers to shift their positions to the higher Call strikes of Rs 260 and Rs 270 suggesting a trend of stuck up positions of Call writers. This bodes well for stock momentum."
"In the recent past, the 100 DMA has also acted as a median mark in the sideways range. A crossover above the 100 DMA has triggered upsides beyond Rs 270. Currently, the 100 DMA is placed at Rs 234, which suggest that until the stock trades above Rs 235, it is likely to maintain its upwards trajectory," says ICICIdirect.com research report.
Recommendation:Buy Titan in cash in the range of Rs 247-252Target: Rs 289Stop loss: Rs 229 on closing basisTime Frame: 3 months
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