Stock Trends - Budget Day

Continuing our stance since the previous few mails, we believe that it is very risky to have naked short positions in the market right now. We believe that there are a lot of stocks that could rise provided the budget is in line with the expectations of the market movers. Budget expectations seem to be muted and focused on fiscal deficit alone. Hence we believe that there is a high chance that the budget might actually surprise us on the positive side.

Having said that following is the stock list; however these are high risk calls and can all hit stop loss if the budget disappoints.

·         Balrampur Chini – Buy at 104 for a target of 110; stop loss at 101

·         Century Textile – Buy at 464 for a target of 474; stop loss at 460

·         Cummins India – Buy at 455 for a target of 462; stop loss at 450

·         Dabur India – Buy at 169 for a target of 172; stop loss at 162 (Good for medium term with a target at 180+)

·         DLF – Buy at 280 for a target of 296; stop loss at 280

·         GVKPIL – Buy at 43.3 for a target of 44.8; stop loss at 42 (good for medium term with a target at 46)

·         HDFC Bank – Short at 1687 for a target of 1666; stop loss at 1697

·         Hindalco – Short at 153 for a target of 149; stop loss at 157 (good short for march series)

·         JP Associates – Buy at 129 for a target of 135; stop loss at 126 (good for medium term with a target at 144)

·         Jindal Steel – Buy at 626 for a target of 650; stop loss at 616 (good for short term)

·         Power Finance – Buy at 249 for a target of 252; stop loss at 246

·         Shriram Transport – Buy at 430 for a target of 435; stop loss at 425

·         Welspun Gujarat – Buy at 237 for a target of 242; stop loss at 230

I have tried to include almost all BSE A group stocks where the trend was clearly visible. We will not be tracking these calls and might not even take positions in many of them. This is just to help you get an idea of what the trend looks like in case you’re holding any one of the above mentioned stocks.

Please do not go blindly long on the market as well because the major Concentration level of call options for March series is being observed at 5,100 of 37.5 lacs shares and 42.5 lacs shares at 4,500 put options. By considering concentration level and premium, march series likely to end between 4,400 at lower end and 5,200 at upper end.

Hope this post helps !