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Mid-cap stocks of the week May 08, 2005
The Mid cap stocks listed below are Nifty 500 components - liquid, traded easily and benchmarked volatility. These are stocks that we expect to out-perform the markets. It should be remembered that many of these stocks are trading with abnormally high volumes, maybe operator driven, and have appreciated significantly. Therefore, the risk element is likely to be very high. Take limited exposure to these stocks and maintain stop losses as specified.
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Individual stocks. |
Asahi India Safety - This auto ancillary was recommended earlier and has been a strong market out-performer. Technical buffs will notice the high relative strength of 256 vis-a-vis the Nifty ( where 100 = base ) and the rising tops and bottoms formation on the weekly chart below. The scrip is now trading near lifetime highs and is likely to breakout above the 185 levels into a new trading zone where little / no resistance will exist. We recommend a buy for patient long term investor.
Your call of action - Buy at current levels in small lots with a view to average on all declines till the 150 mark. Maintain a stop loss at the 125 levels. Expect to book profits at the 250 + levels in a years time in a conducive market scenario.
Asahi India Safety I BOC I Electrosteel I Godrej I Kirloskar Oil I L G Balakrishnan I Rico Auto I Midcap index I Top I Close window I Print page
BOC - this scrip has seen a sharp rally in the last 2 quarters and the relative strength has been ascending. The breakout above the 100 mark has been on higher volumes and the upmove has gained credibility. The oscillators support the upmove and we recommend a buy on all declines for the patient investor - in small / medium sized lots.
Your call of action - start buying at the 100 - 105 levels and leave room for averaging till the 85 mark. Keep a stop loss at the 70 mark. Expect to book profits at the 135 - 140 levels in the medium / long term in a conducive market scenario. We recommend a limited exposure to this scrip.
Asahi India Safety I BOC I Electrosteel I Godrej I Kirloskar Oil I L G Balakrishnan I Rico Auto I Midcap index I Top I Close window I Print page
Electrosteel Casting - this scrip is a steady performer on the charts and is similar to the recommendation made by us on Guj Gas a few months ago. Typically, such counters do not fall much in a weak market and consolidate for months on end. Such hibernating periods are followed by sharp breakouts ( Guj Gas languished near 600 and spurted to 1000 + levels ). We feel this scrip is similar in nature, technical enthusiasts may note the high relative strength of 364 vis-a-vis the Nifty ( where 100 = base ) and the support by oscillators. We recommend a buy in small lots for the patient investor.
Your call of action - Buy as close at to the 400 mark as possible and maintain a stop loss at the 355 levels. Expect to book profits at the 600 + levels after a years time frame. Keep your exposure small as the traded volumes are lower than average.
Asahi India Safety I BOC I Electrosteel I Godrej I Kirloskar Oil I L G Balakrishnan I Rico Auto I Midcap index I Top I Close window I Print page
Godrej Industries - this scrip is attempting a convincing breakout above the 5 month trading range of 105 - 145 with higher volumes. A confirmatory close above this level for atleast 3 trading sessions with high volumes will be the buy trigger for the discerning investors with a patient investor approach. Note the high relative strength of 291 vis-a-vis the Nifty ( where 100 = base ). The oscillators are confirming an upmove. We recommend a buy on a confirmatory breakout.
Your call of action - Buy above a consistent close above the 145 mark and hold with a stop loss at the 110 mark. Expect to book profits at the 185 - 195 in 10 - 12 months time frame in a conducive market.
Asahi India Safety I BOC I Electrosteel I Godrej I Kirloskar Oil I L G Balakrishnan I Rico Auto I Midcap index I Top I Close window I Print page
Kirloskar Oil Engines - This relatively illiquid counter was recommended earlier after it signaled a breakout above the 400 mark. The rally has seen a 20 - 25 % upmove and the chart pattern shows high relative strength. Note the RSC reading of 698 vis-a-vis the Nifty ( where 100 = base ). The 400 mark has become a floor for this counter and the oscillators are pointing towards a further upmove, inspite of a new high the scrip has logged. We recommend a buy.
Your call of action - Buy at current levels and on all declines to the 430 levels and maintain a stop loss at the 400 mark. Expect to book profits at the 550 levels in the medium / long term in a conducive market scenario. We recommend a limited exposure to this counter as the liquidity is lower.
Asahi India Safety I BOC I Electrosteel I Godrej I Kirloskar Oil I L G Balakrishnan I Rico Auto I Midcap index I Top I Close window I Print page
L G Balakrishnan - this low priced scrip was recommended earlier after a breakout above the 24 levels. The same has been a profitable decision and we feel the scrip warrants a continued buy recommendation. The scrip currently quotes near all time highs and traded volumes are rising in the last 6 months. The oscillators are pointing towards a promising future and we recommend a buy.
Your call of action - Buy at 30 levels and hold with a deep stop loss at the 22 - 24 levels. Expect to book profits at the 45 levels in the medium / long term.
Asahi India Safety I BOC I Electrosteel I Godrej I Kirloskar Oil I L G Balakrishnan I Rico Auto I Midcap index I Top I Close window I Print page
Rico Auto - This scrip is in a bull orbit of it's own and is currently trading at it's lifetime highs. The traded volumes are on the upmove and the very high relative strength of 593 vis-a-vis the Nifty ( where 100 = base ) is imbibing bullish confidence. Note the bullish oscillator signals and a rising tops and bottoms formation. We recommend a buy on the counter.
Your call of action - By at current levels and on all declines preferably as close to the 60 mark as possible and hold with a stop loss at the 50 mark. Expect to book profits at the 100 levels in a years time frame in a conducive market.
Asahi India Safety I BOC I Electrosteel I Godrej I Kirloskar Oil I L G Balakrishnan I Rico Auto I Midcap index I Top I Close window I Print page
CNX Mid-cap Index - this index is moving within a truncated band and is trading just above it's averages. Though the CNX Midcap has been out-performing the Nifty 50, we feel the lower tops formation is a sign of caution. A confirmatory close above the 2895 will be a positive trigger for the index and will signal a continued upmove. The oscillators are currently pointing towards a consolidation phase.
Your call of action - This is a pure academic study.
Asahi India Safety I BOC I Electrosteel I Godrej I Kirloskar Oil I L G Balakrishnan I Rico Auto I Midcap index I Top I Close window I Print page
- Have a profitable week.
- Vijay L Bhambwani
- Ceo :- Bsplindia.com
The author is a Mumbai based investment consultant and invites feedback at Vijay@BSPLindia.com and ( 022 ) 23438482 / 23400345.
SEBI disclosure :- The author has no positions in any securities mentioned above.
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