Stock Picks

STOCK IN FOCUS

Motherson Sumi rose by ~5% in Thursday’s trade on above average volumes. We expect MSS to be a major beneficiary of recovery in domestic as well as global passenger vehicle sales and post a robust 18% CAGR in revenues until FY17E.

Recovery in domestic business coupled with execution of new orders will lead to a strong margin expansion in its European business implying an EPS CAGR of over 50% in the next 2 years. 

At current levels, we believe that the stock does not fully reflect the revival in domestic business as well as turnaround in subsidiaries. 

Thus, we reiterate a BUY on the stock with a Target Price of Rs529

INTRADAY PICKS

CESC (LTP: 598) SELL For today's trade, short position can be initiated only in Rs 615- 620 range for target of Rs590 with a strict stop loss of Rs627.

ASHOK LEYLAND (LTP: 74) BUY For today's trade, long position can be initiated only in Rs 72-71 range for target of Rs77 with a strict stop loss of Rs70. 

Buy HCLTech between 2030 to 2050, Target 2120, Stop Loss 2000

Buy TVSMotors between 286 to 289, Target 299, Stop Loss 282   

Positional Pick

Sesa Sterlite Ltd breached one and half month old rising trend with relatively better volume and price cut. 

We believe undergoing momentum will keep stock in pressure till the time it does not sustain

above Rs225, as it reversed after a Triple Top formation. Stock is trading below its major moving averages, where hurdle from 100-days SMA is restricting the rise and negative cross-over in Stochastic (5,3), RSI (14,9) & MACD (12,26,9) are also coinciding with our view and signaling near-term weakness in the stock.

Thus, for today's trade, short position can be initiated only in Rs217-221 for target of Rs200 with a strict stop loss above Rs225.