Reliance can touch Rs 1,500: Sushil Kedia

What was the weakness in technology stocks today…TCS, Infosys, Satyam and Wipro were down about 3-6%… is there some inherent weakness creeping into this when you look at the charts?

Kedia: Infosys perhaps is running ahead of the market in terms of seeking a new low while the Nifty rallies…. Infosys has had a weak chart but within the technology space there are interesting things coming up… there is a pay trade idea, which you could do independently as well… Satyam looks like a stock worth going long here and Infosys looks worth on short…. even while Nifty bounces up further, I’ll not include Infosys in my stock list for finding buy rates.

What is your own take on the US market right now?

Kedia: S&P has next resistance at 930…. and a final one around close to 1,000… I think after some small hesitation at 930, the markets are poised to go up all the way to 990-1,000… that’s been the strongest market that’s been coming in the uptrend… other markets are kind of lagging behind….the global rally looks it still has legs… you can keep a stop loss on Nifty at 2,670 for now.

Two stocks ran away today: one is Reliance, which closed at Rs 1,290 and the other is RNRL which moved 30%.

Kedia: I have not been able to decipher RNRL and the 30 % move in a single day. Last time, there was so much concern, so much negativity about Reliance and the feeling was stock is going to collapse… I told you that there is a Rs 500 jump I am looking at…. out of the Rs 500 jump, Rs 300 has already come… Rs 1,300 is a fulcrum from here for Reliance… I am not going short on Reliance… if the dip comes after 1,200, 1,190, I’m going for buy trade… if it shoots past Rs 1,300, I think it will go till Rs 1,500.. that is until Rs 1,190 is not broken…

The kind of upmove you are looking on Reliance… do you think other Asian markets will also go that distance percentage wise?

Kedia: Different markets have their own volatility structure…. while we were going up, they were going up much higher…. there is nothing like high beta or low beta stocks… the belief is the Indian market has high beta compared to other Asian markets historically… but broadly speaking the Indian markets, from their last lows that we saw, are looking like going up 25-35%… there is no rule that Hang Seng will grow at 35% and taper off 26%, and the Indian market will grow at 35%….

Your thoughts on DLF and Unitech?

Kedia: I think they are the highest beta stocks… the risk when you are holding 100 shares of Unitech is the same as holding 100 shares of RCom but the percentage volatility of it is significantly higher… I am not going to be shocked if that can go up to Rs 100 in the upmove… I am not playing for it…what I am trying to say is that these are not the levels to go short…you should be taking control of your emotions. These stocks are more dangerous than stocks you have seen in the IT era. With that caveat in mind, if you have taken strong positions, and stop losses as deep as 15-17% on both, these can still give 35-40% upmove from here.

Source: Utvi