Wednesday, September 7, 2011 How to trade in three buzzing stocks now? Source: IRIS (05-SEP-11)

In an interview with, Prashanth Tapse, AVP Research, Mehta Equities gave views for three buzzing stocks on Monday. The same is as follows:

NMDC: Country`s top miner NMDC is in action for last couple of days basically on the back of its recent news on expansion plan. It is in the process of ramping up its production in Karnataka’s Bellary to 1 million ton per month. The above plan is been chocked out following a July 29 ban of the apex court on mining activities in Karnataka’s Bellary due to environmental degradation of the area. The ban led to a severe shortage of iron ore in the southern India as Bellary accounts for about 80% of Karnataka’s total production at about 40 million ton per annum.

We are positive on the business prospects and re-structuring exercise, hence we recommended investors to add NMDC as a value stock for short term - medium term horizon with a target 260. Technically immediate target is seen at 240.

Shares of the company gained Rs 8.15, or 3.68%, to trade at Rs 229.80. The total volume of shares traded was 32,904 at the BSE (2.23 p.m).

Suven Life Sciences: We believe fundamentals for Suven life science are reasonably good. The stock is outperforming the market expectation basically on the back of its recent approvals for four products for its new chemical entities (NCEs), which could be used in the treatment of various central nervous system disorders. The four product patents, one from Europe, two from Sri Lanka and one from Korea, are valid through 2027, 2025 and 2024, respectively. With these new patents, Suven has a total of eleven (11) granted patents from Australia, and twelve (12) granted patents from New Zealand. These granted patents are exclusive intellectual property of Suven and are achieved through the internal discovery research efforts. Products out of these inventions may be out-licensed at various phases of clinical development like at Phase-I or Phase-ll. The above product pipeline of molecules in CNS arena that are being developed for cognitive disorders, which has an estimated USD 30 billion market potential globally.

Technically the counter could be on consolidation phase hence we advice investors to accumulate for medium to long term horizon with a target of Rs 22-25 with a stop loss level at Rs 15.

Shares of the company gained Rs 0.45, or 2.68%, to trade at Rs 17.25. The total volume of shares traded was 163,807 at the BSE (2.25 p.m).

Reliance industries: RIL is witnessing a profit booking attempt as against the stock had outperformed the market over the past one month. We remain cautious on the counter. Only hope would be the RIL BP deal which could significantly boost natural gas output from the country`s largest gas field in the D-6 block in the next two to three years, and make handsome gains, as gas prices are due for revision in 2014. BP last week completed its USD 7.2-billion deal to acquire 30% stake in Reliance`s 21 oil and gas blocks, including D-6 where natural gas output has fallen sharply as the reservoir turned out to be different from what the company had initially envisaged on the basis of surveys.

Technically one can see a support near 755-760 levels and later on once its hold above 780-790 levels we can trade with a target of Rs 820-840 for medium term horizon.

Shares of the company declined Rs 13.1, or 1.63%, to trade at Rs 792.30. The total volume of shares traded was 422,534 at the BSE (2.27 p.m).

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