What is the outlook for the stock of YES Bank? I have bought the shares at ₹18. Can I continue to hold it
Seetha Rajagopalan, Chennai
YES Bank (₹21.20): The stock has seen a sudden surge over the last two weeks. This indicates that the stock is attempting to see a fresh rise after having stuck in a narrow range for more than two years. Cluster of supports are poised in the ₹19.5-17 region. The chances are looking high for the stock to sustain above ₹19.5 itself. Another important thing to watch is whether YES Bank can retain the current momentum. If it maintains the momentum, then a rise to ₹39-40 can be seen in the next three-six months.
Can YES Bank breach ₹40? Not very clear at the moment. But if it breaks above ₹40, then an extended rise to ₹80 and even ₹100 is a possibility. But for now, we prefer to allow for a rise to ₹40 and then see how the price behaves thereafter. Keep a stop-loss at ₹16. Trail the stop-loss up to ₹21 when the stock touches ₹29. Move the stop-loss further up to ₹34 when YES Bank rallies to ₹38. If the price turns down from ₹40, then exit the stock. Else you can hold it for ₹80.
I have bought shares of Bharat Heavy Electricals Ltd (BHEL). My average purchase price is ₹67. What is the outlook for this stock?
BHEL (₹80.90): The stock is in a strong uptrend. BHEL made a high of ₹91.45 and has come down sharply from there. However, an important support is at ₹78-77. The chances are high for the current fall to halt here. As such, we can look for the stock of BHEL to reverse higher again from the ₹78-77 support zone. A fresh leg of upmove thereafter can target ₹98-100 or ₹107 on the upside over the next one-two months. Another correction from around ₹100 cannot be ruled out.
From a long-term perspective, BHEL has to breach ₹107 to see further higher levels. Such a break can take the stock up to ₹150-160 and even ₹200 over the long term. But this rally might take a considerable time. So, you will need a lot of patience. Assuming that you are a long-term investor, keep a stop-loss at ₹74. Move the stop-loss further up to ₹87 as soon as the stock moves up to ₹96. Move the stop-loss further up to ₹120 when BHEL touches ₹145. Exit at ₹160.