19 October 2009

8 stks that were buzzing last week and how to trade them now

8 stks that were buzzing last week & how to trade them now

Bank Index advanced 8.3%, SBI zoomed 17.8%, ICICI Bank gained 6.5%. The Metal index surged 8%, Jindal Steel & Power rallied 16%, SAIL and Tata Steel surged 6.8% and 6.5% respectively. The top index gainers this week were Cairn India up 11.8%, TCS up 6.3% and RIL up 5.3%. However, telecom stocks like Reliance Comm and Bharti lost 6% and 5.3% this week respectively. Mehraboon Irani, VP-PMS, Centrum Broking, Technical Analyst, Sudarshan Sukhani and Dipan Mehta, Member, BSE/NSE discussed various stocks. They were bullish on Unitech, Torrent Power, Hindustan Unilever (HUL), Jindal Steel & Power, LIC Housing Finance and SBI while were bearish on Bharti Airtel. However, they had mixed views on Larsen and Toubro.
Bharti Airtel
Mehta told CNBC-TV18, "Telecom has been on underperformer over the past two-weeks or so since the news came out that Reliance itself was offering at very competitive rates for outgoing and on the whole we are seeing that there could be regulatory change as far as shifting from per minute to per second billing takes place. That could impact the profitability in the short to medium-term quite drastically and therefore my sense is that one should remain underweight on the sector. My specific advice would be to look at exiting out of Bharti Airtel and the other telecom stocks. But then again it could be at a trading bounce and need not necessarily be at this price.”
Irani told CNBC-TV18, "The one space we are advising investors really exit is the telcom. It is not fair to state that Bharti is a great company – no doubt about it – but buy this stock if it gives you an opportunity. It has come down so sharply because this is not the way you look at stocks. The fact of the case is as far as telcom goes, according to me the story for the time being is certainly over. So, a bounce back here and there of 5-10% not ruling out but for an investor I don’t think this is the way one should be looking at stocks. One can definitely wait for a bounce back but learn to exit at higher levels. There are better opportunities elsewhere.”
Sukhani told CNBC-TV18, "My sense is that telecom stocks are on the verge of bottoming out, which means Bharti Airtel may not be Rs 330 but it could be Rs 300 or Rs 290. That’s a different issue. For a long-term investor, this is the right time to go and invest in telecom stocks; I would say that on the basis of long-term views on the charts.”
Sukhani told CNBC-TV18, "I don’t think Unitech is going to outperform the market. What we saw was a bounce in what is essentially a downtrend and my assumption is that if the market were to remain cheerful we could see Rs 140 or Rs 150. But at this point it looks very unlikely that Unitech would touch Rs 200 again.”
Irani told CNBC-TV18, "I feel that when Unitech managed to raise funds for itself some month’s ago – the problems for Unitech were behind it. At that time we started liking the stock and we had a target of Rs 125 for it. At the present level it is more of a trading play but we don’t enter a stock for a 10-15% return at this particular level of the indices. For the last seven months the company has made bookings of nearly Rs 40 billion (Rs 4,000 crore) which is ahead of most estimates. They are also concentrating more on the affordable homes, which could bring down the rate per square feet with the company books it had. But all said and done according to me the stock could possibly definitely move at least 10-15% up from here. The problems for the entire real estate are going to continue for some more time to come.”
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Src: Moneycontrol.com
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