The Hindu Business Line : Query Corner: Fresh long-term uptrend in Indusind Bank

Voltamp Transformers (Rs 741.7): The recovery from the March low of Rs 265 in Voltamp is halting at the key intermediate-term resistance of Rs 900. The stock has been unable to penetrate this level over the last four months and has been moving in a narrow range just below it. The medium-term trend in this stock however continues to be up and if the stock holds above Rs 650, then it can move higher to Rs 1,100 or Rs 1,300 over the next twelve months.

Investors with a medium-term perspective can hold with a stop at Rs 650. Decline below Rs 650 will imply an impending move to Rs 510. Long-term investors can hold the stock as long as it trades above this level.

Alstom Projects India (Rs 521.3): In our review of this stock in July 2008, we had indicated that the long-term support was in the zone between Rs 200 and Rs 240. Alstom Projects rebounded many times from this zone between October 2008 and February 2009 before moving up to the recent peak of Rs 610. Immediate resistance for the stock is at Rs 650 that is half of the losses recorded in 2008. If this level is surpassed, the stock can rally to Rs 760.

Investors with a short-term horizon can hold with a stop at Rs 470 while long-term investors can hold with a deeper stop at Rs 345.

I am holding Indian Hotels purchased at Rs 86 and Deepak Fertilisers at Rs 64 for the last one year. Please tell me whether both the stocks will touch Rs 115 in next 3 months. Alok Varshney

Indian Hotels Company (Rs 83.9): Indian Hotels faces strong intermediate term resistance at Rs 86 that occurs at 38.2 per cent retracement of the 2008 fall.

The stock moved beyond this level in the second week of November but has not managed a strong close beyond this level yet. However the medium-term trend continues to be strong and the stock could attain the levels of Rs 104 or Rs 115 in the next three months. Investors with a medium-term perspective can hold the stock with a stop at Rs 78.

The stock has formed a long-term trough at Rs 34 in March and even if the stock launches in to an intermediate decline, it is likely to find support at Rs 56. Long-term investors should therefore hold this stock with a stop at Rs 55.

Deepak Fertilizers & Petrochemicals Corporation (Rs 90.3): Deepak Fertilizer is also in a strong medium-term up-trend and can attain your target of Rs 115 in the next three months. The stock has retraced half the slide from the December 2007 peak of Rs 167.

Key intermediate resistance for the stock is at Rs 110 and Rs 128 and the stock can form a peak between these two levels also. Stop-loss for investors can be at Rs 82. Breach of this level will pull the stock down to Rs 67.

I am planning to invest in Indusind Bank at current levels. What are the stock's prospects? J K Venkatesh Prasad

Indusind Bank (Rs 120.7): In our review of this stock in August, when the stock was poised at Rs 95, we had noted a positive bias in the medium-term outlook and a possible move towards Rs 105 or Rs 135 in this period.

The stock recorded the peak of Rs 145 on October 20 and has turned volatile since then as the previous all-time high was at Rs 136, recorded in December 2007 is in the vicinity. The spectacular move from March low of Rs 26 denotes that a fresh long-term up-trend is in motion in this stock.

However one-leg of this up-trend could have ended at Rs 145 and the stock appears to be in a medium-term correction that can result is a sideways movement between Rs 100 and Rs 150 for a few more months.

Investors wishing to buy this stock can do so in declines close to the Rs 100 mark with a stop at Rs 95. Subsequent supports are Rs 86 and Rs 72. Minimum target on a break-out above Rs 145 is Rs 174.

What are the prospects of Electrotherm India and Lloyd Electric and Engineering? TomlinTomichan

Electrotherm India (Rs 250): This stock is biding its time after the recent peak of Rs 306. The medium-term view on this stock will stay positive as long as it holds above Rs 218.

If this level is not breached, a rally to Rs 360 or Rs 430 can be expected over the ensuing 12 months. Investors can therefore hold the stock with a stop at Rs 200. Key medium-term support for the stock exists at Rs 160.

Lloyd Electric & Engineering (Rs 55): This stock is making a valiant effort to claw upwards from the July low of Rs 27. Key medium-term resistance for this stock is at Rs 62, where it is currently pausing.

Though the trend along both the short and medium-term time frames continue to be up, the stock could get in to a mild decline from here that pulls it down to Rs 45. Investors can hold the stock as long as this support holds.

Those wishing to buy the stock can do so on a firm weekly close above Rs 65. The medium-term target would then be Rs 96.

What are the technical prospects of Pidilite Industries for the next 12 months? Sanjeev Shahane

Pidilite Industries (Rs 196.2): The crash of 2008 made Pidilite Industries halt at the long-term support band between Rs 80 and Rs 90 and the stock has recouped almost all the losses since then. There will however be some difficulty in surpassing the long-term resistance zone between Rs 200 and Rs 220. Inability to surpass this level will result in the stock moving sideways between Rs 130 and Rs 200 for the next 12 months. Long-term investors can therefore hold with a stop at Rs 120 while those with a shorter investment horizon can divest some of their holding in the resistance band mentioned above.

Long-term target on a strong break above Rs 220 is Rs 300.

Kindly advise me on the short and long-term targets of Parsvanath Developers. Suresh Dabke

Parsvanath Developers (Rs 104.5): This stock continues in the throes of the bear's grip. The medium-term resistance at Rs 165 remains unconquered and as long as the stock remains below this level, it is expected to vacillate in a wide band between Rs 50 and Rs 150. In other words, the stock can move close to its March lows over the medium-term. Long-term outlook will turn positive only on a weekly close above Rs 165. Subsequent target is Rs 250.

The short-term trend in the stock is also down and a decline to Rs 91 or Rs 76 is possible in this period. Short-term investors can hold it with a stop at Rs 85.

—Lokeshwarri S.K.

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