The Hindu Business Line : Query corner

Wockhardt (Rs 411.7): This company is trying to claw its way out of the deep fall it witnessed in May 2006. The price is consolidating in the island between the 50-day and 200-day moving averages. There is long-term resistance at Rs 420. The price needs to close above Rs 420 for it to head higher towards Rs 440 or Rs 470. If the price turns down from these levels, it will spend the next few months consolidating in the range between Rs 320 and Rs 420. Book some profit at current levels and hold the rest with a stop at Rs 385.

Dr. Reddy's Labs (Rs 788.9): This stock is moving in an upward moving channel since the June lows. The upper boundary of this channel is positioned at Rs 840. We need a strong close above Rs 850 to take the price to the former highs of Rs 877. The lower boundary is positioned at Rs 720, which would act as the base for any short-term correction. Long-term investors can hold on to this stock as long as the low of Rs 720 holds. Hold with a stop at Rs 700. Book profits if the price fails to clear Rs 828.

What is the short-term outlook for 3i infotech? Vishal Mehta, Ajith Thottupurkal

3i Infotech (Rs 184.9): 3i infotech has gained 50 per cent from its June low of Rs 125. The price has long-term resistance at Rs 190, from where the price is currently turning downwards. We have sell signals from the weekly charts, which denote a medium-term trend reversal. The short-term support level to watch out for is Rs 166. If the price consolidates above Rs 166, it can move higher to Rs 200 or Rs 220 over the next one year. Long-term investors can consider entering this stock if it consolidates above Rs 160.

Short-term investors can exit at if the price fails to cross the Rs 195 in the next few days.

I have bought Rolta India at Rs 220. Should I hold this share or sell it? Kamal Chand

Rolta India (Rs 236.6): The chart of Rolta (I) recorded a sharp upward move on Friday. A sideways consolidation is apparent in this stock since August 2006.

The price is currently stuck in a range between Rs 200 and Rs 235. Since this sideways move comes after a steep upward move, we can expect the stock to continue to move higher to Rs 270 or Rs 313 over the next one year. Hold the stock with a stop at Rs 195. Fresh buying can also be done in dips with the same stop.

I have bought FDC at Rs 43 and Tamil Nadu News Print at Rs 89. Can you analyse the prospects of these investments. Abraham, Yashpal Patil

FDC (Rs 39.6): This stock is in a severe down trend. The trend is weak on daily, weekly and monthly charts. The price will have difficulty rising above Rs 50 in the next one year. FDC has long-term support at Rs 34. That is where a long-term investor should keep his stop loss level.

Short-term investor can hold the stock with a stop at Rs 38. Some signs of life are evident on the daily chart. There can be a short-term rally to Rs 42, where you can exit this stock.

Tamil Nadu Newsprint (Rs 94): This stock is moving in a broad sideways range between Rs 80 and Rs 110 since June 2006. The short-term trend in this stock is weak. It is currently below its long-term averages.

Hold the stock with a strict stop at Rs 90. A recovery from here can take the price to Rs 103 or Rs 108 where you can contemplate exit.

Fall below Rs 90 will drag the price lower to Rs 86 or Rs 80.

I hold Hyderabad Industries at an average price of Rs 360. I am willing to hold on to this stock for the long-term (3 to 5 years). Can I add to my quantity at these levels? Or would it be wise to exit and re-enter later? Hemant Sreeraman, Narasimha Rao

Hyderabad Industries (Rs 295.7): Hyderabad Industries is in a long-term bear spell. The stock recorded a strong upward move last week.

But it will have difficulty rising above the zone between Rs 360 and Rs 370. Contemplate fresh additions only if the price records a weekly close above Rs 370. If the price has difficulty rising above Rs 350, exit this stock and re-enter later if the price breaks out above Rs 370.

Please give the support, long-term target and the price levels to buy into the following stocks — Aksh Optifibre and Champagne Indage. Sushil

Aksh Optifibre (Rs 45.7): Aksh Optifibre has long-term support in the zone between Rs 37 and Rs 40. Buying can be done in this zone with a stop at Rs 35 for long-term. Long-term targets are Rs 62 and then Rs 95.

Champagne Indage (Rs 450.1): This stock is already above its all-time high and is displaying considerable strength. Short-term investor can enter this scrip between Rs 410 and Rs 430.

Long-term investors can wait for a dip to Rs 330. The price can go on to Rs 600 in the long term.

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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