Short term call ( 8th Aug 08 )
We recommend a buy in Dish TV India from a short-term perspective. It is clearly visible from the charts of Dish TV India that it had been on a medium-term downtrend between April and July (from a high of Rs 66 to Rs 26). After recording a 52 week low at Rs 26 in early July, the stock reversed and began to trend upward.
This reversal was triggered by a positive divergence in the daily relative strength index. On August 4, the stock jumped 9 per cent breaking through the medium-term down trendline.
Subsequently, on August 7, the stock surged 11 per cent strengthening the up move. We observe heavy volume over the past four trading sessions. The daily RSI has entered into the bullish zone from the neutral region.
The moving average convergence and divergence is on the brink of entering the positive territory.
The stock is trading well above its 21- and 50-day moving averages. We are positive on the stock in the short-term.
We anticipate the stock to move up until it hits our price target of Rs 42 in the approaching trading sessions. Traders with short-term perspective can buy the stock, while maintaining a stop-loss at Rs 35.50.
BL Research Bureau
Friday, August 8, 2008
HPCL, Analyst reco
HPCL - 6th Aug 08
CMP:RS 234.20
TARGET PRICE:NA
ICICI Securities has maintained a ‘buy’ rating on HPCL even after the company reported a recurring loss of Rs 880 crore in the first quarter of the current financial year due to lower than expected subsidy support from the government and upstream companies. The brokerage expects subsidy support to increase over the year as the government has not yet accounted for the Rs 40,000 crore unallocated burden.
“Though we continue to believe that the stock may remain subdued in the short term till the government decides the final subsidy burden-sharing formula, the company is trading at a significant discount to the replacement value of its asset,” says the report. The brokerage also highlights the fact that risks of further increase in interest costs along with expectations of a fall in refining margins could potentially impact earnings.
Positive surprise, however, on higher subsidy sharing by upstream companies and oil bonds could be a boost to stock prices it adds. Positive news on the E&P front and implementation of subsidy reforms recommended by the Rangarajan Committee could trigger re-rating in the stock, says the report.
CMP:RS 234.20
TARGET PRICE:NA
ICICI Securities has maintained a ‘buy’ rating on HPCL even after the company reported a recurring loss of Rs 880 crore in the first quarter of the current financial year due to lower than expected subsidy support from the government and upstream companies. The brokerage expects subsidy support to increase over the year as the government has not yet accounted for the Rs 40,000 crore unallocated burden.
“Though we continue to believe that the stock may remain subdued in the short term till the government decides the final subsidy burden-sharing formula, the company is trading at a significant discount to the replacement value of its asset,” says the report. The brokerage also highlights the fact that risks of further increase in interest costs along with expectations of a fall in refining margins could potentially impact earnings.
Positive surprise, however, on higher subsidy sharing by upstream companies and oil bonds could be a boost to stock prices it adds. Positive news on the E&P front and implementation of subsidy reforms recommended by the Rangarajan Committee could trigger re-rating in the stock, says the report.
HDFC Bank, Broker tips
HDFC BANK - 6th Aug 08
CMP: RS 1,184.35
TARGET PRICE: RS 1,400
Indiabulls has maintained a ‘buy’ rating on HDFC Bank as it feels that the bank would revert to its more profitable numbers once Centurion Bank of Punjab (CBoP) is integrated in its existing network. “Sound fundamentals make HDFC Bank a strong performer,” says the report, adding that “despite taking a nominal hit on its net interest margin (NIM) post the merger with CBoP, net interest income (NII) grew by 74.9% YoY and fee income by 37.3% YoY.”
This pulled up net profit by 44.6% and on a proforma basis, by 31.1%. While the bank recorded a 111.60% YoY increase in its non-performing assets, the brokerage feels it is more on account of the merger than due to a deterioration in asset quality, since HDFC Bank’s net NPA ratio stood at 0.5% of net advances this quarter.
CMP: RS 1,184.35
TARGET PRICE: RS 1,400
Indiabulls has maintained a ‘buy’ rating on HDFC Bank as it feels that the bank would revert to its more profitable numbers once Centurion Bank of Punjab (CBoP) is integrated in its existing network. “Sound fundamentals make HDFC Bank a strong performer,” says the report, adding that “despite taking a nominal hit on its net interest margin (NIM) post the merger with CBoP, net interest income (NII) grew by 74.9% YoY and fee income by 37.3% YoY.”
This pulled up net profit by 44.6% and on a proforma basis, by 31.1%. While the bank recorded a 111.60% YoY increase in its non-performing assets, the brokerage feels it is more on account of the merger than due to a deterioration in asset quality, since HDFC Bank’s net NPA ratio stood at 0.5% of net advances this quarter.
Stocks - Analyst recommendations
Stock: Tata Motors ( 7th Aug 08 )
Anand Rathi Securities has initiated a medium term technical ‘buy’ call on Tata Motors. The brokerage suggests buying this stock between Rs 430-440 with a stoploss of Rs 399 for a target of Rs 520. The current market price is Rs 440.
The stock has sustained above its strong resistance levels at Rs 435-440. The 14-day Relative Strength Index indicates the stock is in an oversold zone and the candle stick chart has formed a bullish engulfing pattern.
“We strongly believe that the stock has entered into medium term bullishness with substantial upside,” Anand Rathi says in its report
Anand Rathi Securities has initiated a medium term technical ‘buy’ call on Tata Motors. The brokerage suggests buying this stock between Rs 430-440 with a stoploss of Rs 399 for a target of Rs 520. The current market price is Rs 440.
The stock has sustained above its strong resistance levels at Rs 435-440. The 14-day Relative Strength Index indicates the stock is in an oversold zone and the candle stick chart has formed a bullish engulfing pattern.
“We strongly believe that the stock has entered into medium term bullishness with substantial upside,” Anand Rathi says in its report
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