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B. Krishnakumar

What is the outlook for NIIT and Bata India? — Ramesh

NIIT (Rs 190.7): After a sharp uptrend, the stock has turned weak in the past few days. There appears to be little downside risk from current levels. Only a drop below Rs 170 would be a cause of concern. Remain invested with a stop loss at Rs 170 as the stock could seek the Rs 215-220 range on the completion of the ongoing decline. The only caveat is that a drop below Rs 170 would be a cause of concern and a breach of Rs 150 would negate the positive outlook.

Bata India (Rs 48.4): The stock appears to be headed towards higher levels in the near term. A move to the Rs 58-60 range appears likely. Only a drop below Rs 37 would invalidate the positive outlook. Remain invested with a stop loss at Rs 37. Risk-averse investors could place the stop loss at Rs 43.

I bought LML at Rs 54 and Rain Calcining at Rs 19.5. Please give the levels up to which I can hold. — P.G.K. Raju

LML (Rs 61.7): Despite the weakness in the past few days, the overall trend appears bullish. Only a drop below Rs 55 would be a cause of concern. On the upside, a rally towards the Rs 75-80 range appears likely. Remain invested with a stop loss at Rs 55. A close above Rs 70 would reinstate positive trend and could be used to take fresh exposures.

Rain Calcining (Rs 23.9): The stock has already moved past the initial target price of the Rs 25-26 range that was mentioned last week. After touching a high of Rs 26.5, the stock turned weak on Wednesday. The overall outlook remains positive and the uptrend would resume once the ongoing correction gets completed. Remain invested with a stop loss at Rs 20.

I bought TVS Motors at Rs 900 and i-flex Solutions at Rs 710. Please advise if I should hold or sell? — G. Ananthapadmanabhan

TVS Motors (Rs 889.2): The outlook for this stock has been covered earlier (edition dated October 5). The share price touched Rs 950 on Wednesday and has dropped to lower levels in the past few days. However, the earlier view that the stock could move to Rs 1000 remains valid. Remain invested with a stop loss at Rs 825. There is no technical reason to liquidate holdings in a hurry.

i-flex Solutions (Rs 689.9): The price history for the stock is inadequate to arrive at a firm conclusion about the overall outlook. The near-term trend, however, appears weak and only a close above Rs 840 would reinstate positive trend. Remain invested with a stop loss at Rs 650. Aggressive traders could consider long positions with a close stop loss if the stock closes above Rs 770.

I recently bought BHEL at Rs 483. Last week the price has gone down. Should I hold on or sell. What would be the stop loss? — Satish

BHEL (Rs 449.9): Though the stock could seek lower levels in the near term, a move past Rs 500 appears likely. On the downside, a drop to the Rs 410-420 range appears likely. Taking into account the long-term uptrend, existing holders could remain invested. Considering the size of your holding and future prospects, it would be worthwhile to hold on to the exposure. Stop loss may be placed at Rs 410.

What is the long-term outlook for Elgi Equipments and Amtek Auto? — E.Raju

Elgi Equipment (Rs 65): The share price has been on a major uptrend from the level of about Rs 15 in March. The uptrend does not appear complete and a move to the Rs 75-80 range appears likely. Remain invested with a stop loss at Rs 58. A close below Rs 58 would blunt the positive outlook and this would warrant dilution of holdings.

Amtek Auto (Rs 309): After a sharp uptrend, the stock has turned weak in the past few days. The recent price pattern indicates that the decline would continue for a while. Only a move above Rs 340 would impart bullishness. On the contrary, a drop below Rs 280 would imply that the stock could drop to much lower levels of the Rs 240-250 range. Remain invested with a stop loss at Rs 280. Risk-averse investors and holders who are "in-the-money" could book profits at current levels. Fresh buying may be considered on a move above Rs 340.

I bought Neyveli Lignite at Rs 59. What is the near-term outlook? — Narayanaswamy

Neyveli Lignite (Rs 58.6): Though the share price has been on a downtrend since Tuesday, the long-term trend remains bullish. The positive outlook would be invalidated only if the support level at Rs 48 is breached. Considering the long-tem positive outlook, it would be worth the risk to remain invested with a stop loss at Rs 48. A close above Rs 65 could be used to add to the holdings with a stop loss at Rs 53.

I hold Videocon International shares purchased at an average price of Rs 30 and Bombay Dyeing purchased at Rs 75. Is there further upside potential for these stocks? — C.A. Varghese

Videocon International (Rs 66.9): The stock has potential to seek further highs. A move to the Rs 85-90 range appears likely. The only hitch is that the share price has faced stiff resistance at the Rs 71-73 range in the recent past. It has reversed from this range on three occasions earlier. The possibility of an uptrend hinges on the break of this level. On the other hand, a decline below Rs 53 would negate the positive outlook and could push the stock to lower levels. Remain invested with a stop loss at Rs 53.

Bombay Dyeing (Rs 152.8): The outlook for this stock is covered under the "Focus of the week' section on this page.

This query to be boxed

What is the medium-term outlook for Glenmark pharma and Bharat Electronics? — Pradeep

Glenmark Pharma (Rs 79.8): The recent uptrend is not yet over. A move above Rs 90 would result in the resumption of the uptrend. Only a drop below Rs 65 would negate the positive outlook. Taking into account the positive outlook, holders may remain invested with a stop loss at Rs 74.

Bharat Electronics (Rs 478.2): The share price could move to higher levels of Rs 600-625 in the near term. The recent uptrend is not over as yet. Only a drop below Rs 420 would invalidate the positive outlook. There is no need to dilute holdings now. Remain invested with a stop loss at Rs 420. A move past Rs 550 could be used to take fresh exposures with close stop loss in place.

I hold KEC International purchased at Rs 47 and CESC at Rs 125 per share. What is the near-term outlook for these two stocks? — Preetha Nair

KEC Intl. (Rs 49.5): The stock appears to have the potential to yield at least 50 per cent returns from current levels. After a prolonged downtrend, the stock reversed direction in March 2003. It has just commenced a major uptrend and there is no reason to sell this stock in a hurry. Remain invested with a stop loss at Rs 40.

CESC (Rs 132.8): Though the stock could rule weak in the near-term, the long-term trend is positive and a move to the Rs 160-170 range appears likely. Only a drop below Rs 110 would blunt the positive outlook. Remain invested with a stop loss at Rs 110.

I hold shares of Escorts. Is it time to sell? — R.V.Chandramouli

Escorts (Rs 73.2): The stock could seek higher levels at the Rs 85-90 range after the completion of the downward correction that began on Wednesday. However, a drop below Rs 66 would be an early indicator of weakness and a close below Rs 61 would almost negate the positive outlook. Risk-averse investors could have a stop loss at Rs 66. Investors with a higher risk appetite may place the stop loss at Rs 61.

I am holding shares of Sterlite Industries and Hindalco. Kindly suggest whether I should hold or sell. — Bhavana P. Shah & Pankaj.

Sterlite Industries (Rs 1326.9): There is no reason to sell the stock at current levels, as the long-term trend is positive.

The recent upward movement does not appear complete and a move to the Rs 1600-1650 range appears likely. Remain invested with a stop loss at Rs 1100. Only a drop below this level would push the stock into a downward corrective phase.

Hindalco Industries (Rs 1195.6): The stock is in a major uptrend. Technically, it would worthwhile to remain invested as the stock could seek higher levels in the Rs 1450-1500 range.

Only a close below Rs 1100 would be a cause of concern. Remain invested with a stop loss at Rs 1100.

(Note: The analysis and opinion expressed in these columns are based on the technical analysis of the past price behaviour. Analysis and price targets are based on the Elliott Wave Analysis. There is a risk of loss in trading)

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