Stock Recommendations

SENSEX (27316) BSE Sensex opened positive with the gap of around 100 points and traded in a pleasant mood throughout the day in line with the U.S market. It pierced its 35 DMA and headed towards 50 DMA and finally ended the session with the handsome gains of around 200 points. Now till it doesn’t negate its positive price formation, momentum may continue towards 27500 and 27700 zones, while if it fails to hold 27300 zones then bears may again propel the market to drift towards 27000 zones.

STOCK IN FOCUS

M&M surged ~4% in Friday’s trade on more than 2x its 2-week average volumes, as sentiments towards the stock were supported by the better-than-forecasted beginning of Indian monsoon, which is a positive for the company’s tractor business.

Further, time looks exciting for the company in FY16 with 9 product launches (3 new platforms, 3 refreshes and 3 variants) lined up between 1Q-3QFY16E. Moreover, worst for the farm equipment division has been factored in and a good monsoon in FY16E would provide a much needed fillip to tractor sales. 

We reiterate our BUY recommendation on the stock with an SOTP-based Target Price of Rs.1,499. We value the standalone business at Rs1,043 (15x FY17E earnings) and subsidiaries at Rs.456.

INTRADAY PICKS

YESBANK (LTP: 830) SELL For today's trade, short position can be initiated only in Rs.838-842 range for target of Rs.815 with a strict stop loss of Rs.846. 

INDUSINDBANK (LTP: 835) SELL For today's trade, short position can be initiated only in Rs.842-846 range for target of Rs.820 with a strict stop loss of Rs.852. 

TATAELEXI is moving after a consolidation of last 11 trading sessions and witnessed strong up move as it crossed its immediate hurdle of 1150 zones. It has surpassed its 50 DEMA with rising trading and delivery volumes and looks quite attractive to continue its next momentum for higher territory. RSI indicator is also supporting our positive view on the stock as turning from oversold territory after a positive price divergence. One can buy the stock between Rs.1174 to 1186 with stop loss of 1155 for the upside target of 1230 levels.

JUBLFOOD has made a new life time high of 1835 by crossing its previous high of 1822 made in the first week of the series. It has been holding the gains and heading upwards even after the volatile market move which indicates exorbitant strength of the counter. It has been making higher top – higher bottom from last eight trading sessions and registered a highest ever daily and weekly close. One can buy the stock between Rs.1790 to 1808 with stop loss of 1763 for the upside target of 1871 levels.

Technical Recommendations 

HCL Tech, witnessed sharp correction this month from the peak of Rs1,045 to recent low of Rs.883, before retracing part of the losses. Stock continues to have good support at lower levels in the range of Rs.900 to Rs.880 while at the same time faces some hurdle in the range of Rs.940-950 on higher side. The positive cross-over on MACD an RSI also indicates formation of short term bottom in the stock and we believe this will help stock to once again move towards the recent peak, provided stock does not close below crucial 200 day simple moving average now placed at Rs.880.

Thus, for today's trade, long position can be initiated only in Rs.900-880 range for target of Rs.1,020 with a stop loss of Rs.860.