The Hindu Business Line : Query corner

I hold Cholamandalam Investment purchased long ago. Will it be advisable to capitalise on this stock market boom by selling my investments? P. Seshadri, Paleti Srinivas

Cholamandalam Investment (Rs 71.6): It is not advisable to sell as the outlook is bullish. The share price is likely to move to the Rs 100 mark.

A move past Rs 79 would lend credence to the bullish outlook. Fresh exposures may be considered on a move above Rs 80, with a stop-loss at Rs 73. The positive view would be negated if the share price declines below Rs 63. Taking into account that you have been holding the stock for a considerably long period of time and the positive outlook, it would be advisable to hold with a stop-loss at Rs 63.

What is the outlook for TV 18 purchased at Rs 235 and Shah Alloys at Rs 125? Ram Lubhaya

TV 18 (Rs 226.2): There is a fair chance that the stock would move to Rs 245-Rs 250 range in the near-term.

A move past Rs 237 would impart bullishness. Hold with a stop-loss at Rs 215. At least partial profit-booking may be considered on a move to Rs 245-Rs 250 range.

Alternatively, the stop-loss may be moved closer to the prevailing market price when the stock moves to the target zone.

Shah Alloys (Rs 123.5): After a steady upward move, the share price appears to be in a corrective phase. A drop below Rs 119 would impart weakness while a move above Rs 135 may result in the continuation of the uptrend. A decline below Rs 119 would result in a slide to the next support level at Rs 98-Rs 100 range. Hold with a stop-loss at Rs 119.

Investors willing to take risk may consider long positions on a move above Rs 132, with a stop loss at Rs 119. A break above Rs 132 would result in the stock moving to the next target zone of Rs 158-Rs 160 range.

Should I hold or sell my stake in Nava Bharat Ferro Alloys? K. Rajeswari & S.Pandu Ranga Rao

Nava Bharat (Rs 346): The stock is ruling close to the support zone at Rs 330-Rs 335 range. A drop below this zone would result in the completion of a bearish "Head and Shoulder" pattern. This would have negative implications and would push the stock to Rs 285-Rs 290 range. Hold with a stop-loss at Rs 330. A move above Rs 366 would impart strength. This could help the stock resume the earlier bullish trend. A drop below Rs 330 would warrant dilution of holdings.

I hold Apollo Hospitals purchased at Rs 275 and Ind Swift Labs at Rs 270. Please advice whether to hold or sell. K. Loganayaki, Sangeeta Kapoor

Apollo Hospitals (Rs 250): Though the long-term outlook is positive, there is possibility of a drop to Rs 205-Rs 210 range. A drop below Rs 240 would impart weakness and would strengthen the case for a drop to Rs 205-Rs 210 range. Hold with a stop-loss at Rs 239. A move above Rs 262 would impart strength and push the stock to Rs 295-Rs 300 range. A move past Rs 262 may be used to take long positions with a stop-loss at Rs 245.

Ind Swift Labs (Rs 276): The share price has been on a relentless uptrend in the past few months. The upward move does not appear complete as yet. Though the stock could rule weak in the near term, the long-term uptrend is likely to resume shortly. After a drop to Rs 260-Rs 265 range, the stock is likely to resume the upward move. A move above Rs 300 would indicate that the stock has resumed the upward move.

A drop below Rs 250 would, however, blunt the bullish outlook. Stop loss for long positions may be placed at Rs 250.

Kindly advice about my holdings in Electrosteel Castings bought at Rs 353 and Eternit Everest at Rs 135. Meena Kumar, R.L.Balgi

Electrosteel Castings (Rs 339.3): There appears to marginal downside risk that extends up to the Rs 325-Rs 330 range. The stock is likely to resume the next leg of upward move shortly. There is no reason to sell the stock. Hold with a stop loss at Rs 325. A move past Rs 352 may be used to take fresh exposures with a stop-loss at Rs 335.

Eternit Everest (Rs 143.5): The short-term consolidation phase appears complete. The outlook is bullish and the stock could move to Rs 165-Rs 170 range. The view would be valid if the stock does not drop below Rs 126. Hold with a stop-loss at Rs 126.

Long positions may be considered on a move past Rs 150, with a stop loss at Rs 138.

I would like to know the outlook and target for LML bought at Rs 42.25 and IDBI Bank at Rs 48.5. P.Natarajan

LML (Rs 43.6): A bullish trend would prevail if the stock moves above Rs 49. Till such time, they may be stuck in a trading zone. A drop below Rs 35 would have negative implications and would push the stock to lower levels of Rs 23-Rs 25. Hold with a stop-loss at Rs 35. Fresh buying may be considered on a move past Rs 49, with a stop-loss at Rs 42.

IDBI Bank (Rs 59.6): The stock reversed direction on Friday after moving closer to the earlier high of Rs 59-Rs 61 range. This may lead to a potential "double top" pattern that could have bearish implications.

The pattern would be negated if the share price moves past Rs 65. Such a move would have bullish implications and would launch the stock into the next leg of the rally. A drop below Rs 50 would confirm the bearish outlook and the stock could seek lower levels of Rs 38-Rs 40. Hold with a stop-loss at Rs 50. Investors who are uncomfortable with the stop-loss level may reduce exposures at prevailing levels and consider long positions on a move above Rs 65.

Should I hold or sell Saw Pipes bought at Rs 98 and Videocon International at Rs 130? Babu

Saw Pipes (Rs 228.9): Considering the bullish outlook and your purchase price, it would be advisable to hold with a stop-loss at Rs 184.

A move above Rs 238 would indicate that the stock is headed towards higher levels of Rs 265-Rs 270. A drop below Rs 184 would negate the bullish outlook. Investors who have purchased at lower levels may have the stop-loss at Rs 184; the rest may place the stop-loss at Rs 214.

Videocon International (Rs 70.9): The outlook is positive and the stock is likely to move to Rs 78-Rs 80 range. A rise above Rs 82 would impart further strength and would push the stock to the next target zone of Rs 108-Rs 110 zone. Taking into the positive outlook, it would be advisable to hold with a stop-loss at Rs 63.

I would like to have your views on Tata Steel. Shall I buy this stock at prevailing prices? What is the outlook for GNFC bought at Rs 60? — Ravi Kapoor

Tata Steel (Rs 359): The stock is in a long-term bullish trend. It holds significant upside potential from a long-term perspective. Investors comfortable with the "buy-and-hold" strategy may buy this stock at prevailing levels with a stop-loss at Rs 310.

Investors who prefer a tighter stop loss may wait for price dips to buy the stock. The immediate target for the stock is placed at Rs 395-Rs 400 range. A drop below Rs 310 would negate the positive outlook.

GNFC (Rs 65.1): The share price is in a consolidation phase. The upward move would resume after the completion of this consolidation phase.

A move above Rs 72 would be an indication that the stock is headed towards higher levels. Hold with a stop-loss at Rs 60. Fresh buying may be considered on a move past Rs 72.

I purchased Tata Coffee at a rate of Rs 284.3. Shall I hold it or sell it? Lakshmi

Tata Coffee (Rs 264.2): The stock has already moved to the earlier target price (edition dated December 5) of Rs 305-Rs 310 range.

The outlook is bullish and would remain so as long as the stock holds above the stop-loss level of Rs 240. We wish to emphasise that the recommendation or the view furnished earlier would be valid as long as the price holds above the stop-loss level mentioned along with the recommendation. If investors feel that the stop loss mentioned is too wide for their comfort, they may wait for price dips to enter the stock. Long positions should be avoided if the potential loss (arising in the event of a stop loss getting triggered) is beyond the individual's comfort zone.

(Note: The analysis and opinion expressed in these columns are based on the technical analysis of the past price behaviour. Opinion and price targets are based on the Elliott Wave Analysis. The stop-loss level provided with the recommendation is important. The original view would stand negated if the stop loss level is breached. There is a risk of loss in trading)

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