The Hindu Business Line : Query Corner

BHEL (Rs 2,324.9): Pure trend following methods are displaying absolutely no weakness in the short or long-term. But the need for caution arises from the price nearing its all-time high of Rs 2,465 hit in early May. E-wave targets for this rally are Rs 2,403, Rs 2,514 and then Rs 2,643. But we can have the price reversing from either of these levels. Hold the stock with a tight stop at Rs 2,200. Consider booking some profit between Rs 2,450 and Rs 2,500.

What are the prospects of Alembic and Munjal Showa purchased at Rs 370 and Rs 400 respectively? Charles

Alembic (Rs 67.3): The stock has recently undergone a 5:1 stock split and has been one of the stellar performers in the post-June rally. It has managed to recoup almost all the losses made in May crash. The price is reacting downward after hitting a peak of Rs 81 in late September. Short-term investors should exit this stock if it falls below Rs 65. Long-term investors can hold with a stop at Rs 60.

Munjal Showa (Rs 411.9): This stock is reacting after hitting a recent high of Rs 430.9 hit a couple of weeks ago. The price is in a short-term downtrend that can halt at Rs 376 or Rs 362. Exit at current levels if you are a short-term investor. Long-term investors can hold with a deeper stop at Rs 340.

What is the short- and long-term outlook for Bombay Dyeing and Kotak Mahindra Bank? Amit Kar

Bombay Dyeing (Rs 722.9): The scrip is in an intermediate-term uptrend since the low of Rs 395 made in June; it has gained 86 per cent from this low.

This intermediate-term rally faces strong resistance at the Rs 760 level, where it is halting now. We can expect some consolidation between Rs 760 and Rs 600 over the next few months.

Long-term investors can hold the stock with a stop at Rs 600. Short-term investors can book some profits here and hold the rest with a stop at Rs 690.

Kotak Mahindra Bank (Rs 330.9): This stock is moving in the range between Rs 300 and Rs 350 since the middle of August.

Since this sideways move comes after a strong rally from the low of Rs 210, it is can be considered positive as long as the price stays above Rs 280.

Short-term investors can hold this stock with a stop at Rs 280. The short- and long-term targets for this stock are Rs 386 and Rs 437 respectively.

What are the long- and short-term supports and targets for Sunil Hitech? Ramesh, Valli Kasi

Sunil Hitech (Rs 114.6): This stock has lost 55 per cent from the peak of Rs 167 hit in May. The recovery from the June low has not been convincing.

There is short-term resistance at Rs 115. If the stock fails to overcome this, we can expect some sideways movement between Rs 115 and Rs 75 for the next three to six months. A breakout beyond Rs 115 is required to take the price to Rs 138. Hold the stock with a stop at Rs 92.

I am holding Aftek Infosys bought at the rate of Rs 80. Can you advise me whether I should hold this stock or come out of it? B.V. Chandrasekaran

Aftek Infosys (Rs 59): This stock is not showing any signs of strength over the medium term.

There was a recovery from the lows of Rs 39 in June but the price is unable to rally above the short- term resistance at Rs 65. If this rally continues, there can be a rally to the Rs 75-80 level.

This is expected to be the upper limit in the next one year. Investors are advised to exit the stock on any rally and hold the stock till then with a stop at Rs 48.

What is the outlook for SpiceJet? Ganesh V., Ritu Grover

SpiceJet (Rs 46.2): The scrip has lost 60 per cent from the high of Rs 115 touched in September 2005.

The price is moving in a sideways range between Rs 35 and Rs 55 since June. The price will have difficulty breaking out of this range in the short term.

If the price breaks past Rs 55, it can rise to the zone between Rs 60 and Rs 65.

Exit the stock if it fails to overcome the resistance at Rs 65 over the next one year. Till then, hold with a stop at Rs 37.

What should I do with Mercator Lines purchased at Rs 56? Should I average or just hold? Anil Kumar K.