Query corner: Long-term trend positive in Titan Ind

Can you please advise the medium-term prospects of Titan Industries and Gruh Finance?

Shekhar

Titan Industries (Rs 264.2): Titan Industries is in a dazzling up-move since 2001. This secular uptrend continues to be in force. The third part of this long-term uptrend is unfolding since March 2009. Within this uptrend, the stock is in a protracted sideways move since November 2010 with an upward bias.

The movement in October and November last year cannot be taken as a break out since the stock has reversed lower and moved back into the trend channel formed from the November 2011 low.

Medium-term supports for the stock are placed in the zone between Rs 200 and Rs 220. Investors with short- to medium-term perspective can hold the stock as long as it trades above this level. Stop-loss for fresh purchases can be at Rs 195.

The medium-term view for the stock will stay positive as long as it trades above Rs 200. Resistance for this time frame is pegged at the recent peak of Rs 313. The support level that long-term investors ought to be watching for is between Rs 150 and Rs 170.

Gruh Finance (Rs 190.1): This stock has been building a strong up-move since the 2011 trough at Rs 62, giving threefold returns to its investors. The stock is, however, in a medium-term decline since this January. Immediate support is at Rs 180. Investors with short- to medium-term perspective can hold the stock as long as it trades above this level.

Reversal from or above this level will take the stock up to Rs 225 or Rs 250 over the coming months.

Supports on decline below Rs 180 are positioned at Rs 157 and Rs 134. The trend-deciding level from a long-term perspective is at Rs 160.

Please advise on the prospects of Brigade Enterprises allotted to me in the IPO.

Prabhakar Rao

Brigade Enterprises (Rs 70.9): Brigade Enterprises’ public offering was made at the terminal point of the previous bull market. This resulted in the stock price losing 93 per cent in the crash that followed, before hitting a nadir at Rs 28 in March 2009.

It would be next to impossible for the stock to move to its listing week high of Rs 428 over the next two years. A more modest long-term target for the stock is at Rs 180. Targets on move above this level are Rs 251 and Rs 327.

The stock is in a medium-term downtrend since last December. There are a series of supports just below, at Rs 46, Rs 38 and Rs 28, that can support the stock in declines. Long term investors can hold the stock as long as it trades above Rs 28.

Medium-term hurdles will be at Rs 112 and Rs 130. Investors with a short- to medium-term perspective can divest their holding at these levels. We envisage a movement between Rs 40 and Rs 180 over the next couple of years.

I would like to know the prospects of Aanjaneya Lifecare bought at the issue price of Rs 110.

S Saravanan

Aanjaneya Lifecare (Rs 80.2): This stock has been consistently hitting the lower circuit filter since this February. The stock was mired in the problem of pledged shares of the company being sold in the market, thus pressuring prices. Once such issues start impacting stock prices, it is difficult to know where the slide can halt.

This bout of decline has pulled the stock below its listing price. It would be best to exit the stock at this juncture and consider re-entry on a close above Rs 225.

I bought Kesoram Industries at Rs 100 a year ago. What is your technical view on this stock?

Anil Menon

Kesoram Industries (Rs 112.3): This stock is in a structural downtrend since 2008. Though the stock is attempting to halt around Rs 80, the rebound from this level is far from convincing and has not done much to repair the long-term view.

The medium-term trend is sideways between Rs 50 and Rs 150. Investors who are not in the stock for the long haul can divest their holding around the Rs 150 ceiling.

Strong breach of this level is needed to take the stock up to Rs 210 or Rs 290.

It would be best to exit the stock on decline below Rs 70.

I purchased NMDC at Rs 128. Advise me on the long-term prospects of this stock.

Debjit Dey

NMDC (Rs 126.6): You have purchased NMDC close to its long-term support zone around Rs 120. The stock reversed from this area in December 2008 and went on to its lifetime peak at Rs 493. Investors can hold the stock with stop-loss at Rs 110.

But fresh purchases should be avoided on breach below this level since the next support is at Rs 65.

Key medium-term resistance is positioned at Rs 200 and investors with short- to medium-term perspective can exit the stock if it fails to cross this hurdle. Long-term trend will turn positive only on a close above Rs 300.

(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.)

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