In this kind of market many small investor often gets trapped and buys shares which are in fancy like which we have seen in 2008 market crash. If you have missed to read the last week report then let me give you all three stock which we have written to avoid are Think Soft, James Hotels, Jay Bbharat Textile and Real Estate.
Again in this week I am writing about such two stocks from investors should stay away.
Avoid below stocks,
(1) Shree global trade fin:
Company is engage in trading of hot rolled coils, cold rolled steel sheets, hot rolled plate, ms channels, and ms beams.
Out of 67 trading session stock was locked In upper circuits in 53 sessions, despite of the manic move stock continue traded in B category instead of shifting in trade to trade segments.
Let’s checkout the fundamentals of the company.
Stock price is trading with whopping P/E multiple of 1800 and book value of just 10.59 per share.
Investors should be aware of such shares.
(2) Anand Credits:
Under listing agreements clause 34 , the company was suspended from trading due to non payments of annual listing fees from 10 September 2000.
Stock was re-listed on 27 January 2010 with price of 50 and this counter jumped to 65 to its all time high.
This Ahmedabad based company is engage in financial service
We suggest that investor beware of such shares.
SECTOR WATCH-(MID CAP IT INDUSTRY)
In the last weekly report I have given my bullish view on hotel sector and given buy on EIH.
On Thursday and Friday most of TV channel were discussing about bullish trend in hotel sector ahead.
Strong dollar and recovering banking, financial, service and insurance sector is helping to revive larger IT Company such as infosys, wipro, and tcs.
But in my view smaller IT company which are engaged in industrial salutations will do well selectively like engineering, because not only Indian industrial but also world over industrial is recovering.
STOCK PICK:
Geometric:
Company is engaged in engineering salutations and products life cycle management business
This company is promoted by well know business house goderaj group and rakesh jujnjuwals and his wife holds nearly 10% in the company.
This company provides design salutations in India and across the world to automobile and industrial segments.
Last year company has acquired US based modern engineering and revival in industrial will help to revive this company ,apart from this company has changed its hedging strategy against dollar and this will improve the next quarterly results of the company.
Technically this counter is much stronger compare to other mid size IT Company and will outperform.
Investor can buy on deep with stop loss of 41 and expect target of 120-125 based on Elliott wave count
FUNDAMENTAL VIEW ON NIFTY:
Currently nifty is trading above 22 P/E multiple.
In normal condition it trades between 22 to 23 multiple.
While in bubble situation this P/E multiple expand to 28 levels and historically in 1992, 2000 and in 2008 we have seen the same P/E multiple.
As per historic data India stock market enters in bubble zone at every 8 years so next bubble should be only in 2016.
If in this current year nifty and sensex cross 6500 and 21000 levels then we will create history by entering in to bubble zone in just 2 years of time frame.
Those who are value investor or value buyers the valuations are not cheap and margin of safety is also low. But those who follow the growth investing theory the valuation may be cheap.
Those who believe in value investing should book profit if market rise to 21000 from current 18000 levels.
Remember in 2007-2008 we were telling to exit from the market from 18000 levels and target given 11000 then what happen you all know.
TEHCNICAL VIEW OF SENSEX AND NIFTY:
From Elliott wave and Dow Theory if sensex closes 4 consecutive weeks above 17800 then in 3rd wave will rise to 19300/19600 and then finally in 5th wave 21000 levels.
On hourly charts as long as sensex and nifty manage to hold about 5200 and 17800 levels we may see more up side till 5500/5600 in nifty and 18200/18500 in sensex.
If US index S&P 500 gives weekly close above 1178 on Friday then wave count and Dow Theory will take to 1400 levels and strong support will be 1044 levels.
So, all eyes are on US market.
GOLD ANALYSIS:
Before 2 week ago I have given analysis of comex gold and told panic will come only if it gives 3 consecutive closes below $1090 and see it gives close only one day below $1090 and rebound to $1150 levels.
Now major resistance is $1166 on COMEX and on MCX 17100.
MOMENTUM CALLS
Market is at high speed and if you don’t wear helmet while you running bike at 100 speeds your life is at risk.
Hear we suggest you some trading calls but we also suggest you to buy April month put options to hedge you buying position because market is running on high speed and any single bed news will create vertical fall and you may loose significantly
Geomatric software
3rd wave on hourly charts. Buy with stop loss of 65 and target 77.
IFCI
Some speculative position build up in this counter. Buy with stop loss of 49. And target of 57.
Neyveli lignite
As per time series reversal will come. Bbuy with stop loss of 144 and targets of 159/162.
SREI infra
5th wave above 82 on hourly charts. Buy with stop loss 74 and targets of 85/88.
Adani enterprise
3rd wave on hourly charts. Buy with stop loss 467 and target of 530.
IMPORTANT NOTES
On 12 April industrial production data will be announced.
Next week China and Singapore to announce quarterly GDP numbers.
Metals index to relatively under-perform.
Quote of the Week:
For traders,
"A speculator must concern himself with making money out of the market and not with insisting that the tape agree with him."
-From book "Reminiscences of a stock operator".
