The Hindu Business Line : Query Corner

TVS Motors (Rs 116.5): The long- term trend is still up. Long-term support exists in the zone between Rs 75 and Rs 80. This zone will act as a good support if the price slides again over the next one year. Investors can hold this stock with a stop at Rs 70.

For the short term, the price has broken out upwards accompanied by good volumes. Immediate resistance exists at Rs 120, where the price has halted. If Rs 120 is crossed, price can rise to Rs 133 or Rs 145. But, since the stock is currently overbought, wait for a dip to the zone between Rs 95 and Rs 105 before buying this stock.

What are the short-term and long-term targets for Ashok Leyland? D. Nanjundan, Vijendar Bhardwaj, M.N. Prabhu Shankar, T. Vinod Kumar, Prakash Sanghvi, Surojit Roy.

Ashok Leyland (Rs 43.3):

Ashok Leyland saw a steep move upward from a low of Rs 29.5 in January 2006 to a high of Rs 53.9 in May 2006. This entire run-up has been corrected in the subsequent crash. Long-term support exists at Rs 30, where the price has made a double bottom. There is another reliable support just underneath at Rs 26. Long-term investors can keep Rs 25, as a stop and hold this stock.

For the short-term, however, caution is necessary. The price has already retraced 61.8 per cent of the fall since the May 2006 highs. The Rs 45 level will act as a crucial resistance for the next one year. We can expect a dip to Rs 39 or Rs 36 levels in the short term. The ideal place for buying again, for trading purpose, would be between Rs 36 and Rs 38.

I brought Financial Technologies at average price of Rs 1,120. Please let me know its prospects for six months to one year time horizon. Sudhir Patil.

Financial Technologies (Rs 1,480.6):

The slide in May halted at the long-term support of Rs 1,050 in Financial Technologies. Since, this is a 50 per cent correction from its May 2006 peak, this level is not likely to be breached any time soon.

A broad based sideways move between Rs 900 and Rs 1,700 is the most likely scenario for the next two years. Long-term investors can accumulate the stock between Rs 900 and Rs 1,100.

The short-term trend is currently up. The stock consolidated in a band between Rs 950 and Rs 1,250 since 15th June before breaking out last week. The upward targets for the short term are Rs 1,640 and then Rs 1,800. Short-term investors can exit at either of these levels.

What are the prospects of Balrampur Chini purchased at higher prices? Sanjay Wadhwa, Ramawatar, Surojit Roy, P. Ravikumar, S.V.V.S.Prasad, Vimal Bhatia, Prabhu Kumar, Satish Vohra

Balrampur Chini (Rs 98.8)

The long-term support exists at Rs 85. Price has halted above this support. Since, the fall since May has been very steep, selling is coming in at every rally.

The interesting point to note on this counter is the pick up in volumes since August 2006.

We have evidence of accumulation taking place at these levels.

Those who already hold the stock can keep a stop at Rs 78 and continue to hold. Long-term investors can take a contrarian call and accumulate this stock between Rs 85 and Rs 100 with the same stop.

The price will, however, face tremendous resistance from Rs 130 level in the medium term. This level needs to be breached for the price to rise to Rs 160.

Can you outline the prospects of REI Agro for the short & long term? Himanshu Pandit, Suresh Kumar Yadav, Boney Jose

REI Agro (Rs. 119.7):

This stock has been in a downtrend since November 2005. It had knocked off 73 per cent from its peak when it finally bottomed in June 2006.

There has been a good rally from the June low of Rs 58.9. Spike up in volumes on this counter over the last two months is also a positive sign as far as long term is concerned. Long-term investors should hold this stock with a stop at Rs 55. Upward target for the short term are Rs 140 and then Rs 158. Short-term investors can exit at either of these levels if the price falters.

What are the short term and long term prospects of Unitech? Suresh Kumar Yadav, Sridharan, Murugappan, Poothathan Rajendran

Unitech (Rs 239.3):

Unitech is an extremely volatile stock. The long-term support for the price exists at Rs 155.

Investors can hold this stock with a stop at Rs 150. The short-term trend is up and we saw the return of momentum on this counter last week.

The rise in price was also accompanied by a spurt in volumes, which is positive sign. However, there is a strong resistance at Rs 250.

Short-term traders can book profits at current levels if the price fails to overcome this resistance.

A strong breakout above Rs 250 is required to propel this stock towards it May high of Rs 303.9.

Can you please tell me the outlook of McDowell bought at Rs. 451? Vivek Bhatia, Ramawatar

McDowell Co (Rs 634.9):

The crash in the price of McDowell in May 2006 halted at the long- term support at Rs 370. The rally since then has been quite convincing and we seem to have formed a long term low at Rs 370.

Long-term investors can hold this stock with a stop at Rs 360. Short-term targets for the price are Rs 690 and then Rs 800. Traders can buy in dips with a stop at Rs. 500.

Readers can send in their queries, on not more than two companies, to

techtrail@thehindu.co.in.

Queries can also be sent by post to: Tech Trail, 859/860 Kasturi Buildings, Anna Salai, Chennai 600002. We would endeavour to answer as many queries as possible. However, constraints of space will limit the responses featured under this column.

Lokeshwarri S. K.

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