3 top stock recommendations from CA Rudramurthy BV

"This is not the place to buy fresh. For me risk reward ratio does not favour going fresh longs at current level especially for a short term trader. So I am just taking profits on table wherever it is available. One has to be very careful in terms of valuation and you have to now be cautious on market," says CA Rudramurthy BV, Vachana Investments.

What about the rally? Are you booking profits, are you trailing your gains, what is the mood on the benchmark indices and also talk to us about your top picks right now?
First off all for market from those levels of 16800 has made this non-stop move towards levels of 18800 so it has been a 2000 point move on Nifty. And in fact Bank Nifty already made its all-time high and it has just consolidating now but let me tell you for me what next is the question, not just what has happened till now. Yes, I was very bullish on market, market hitting all-time highs on Bank Nifty. Nifty matter of just another 100 points but now let me tell you everything is priced in and I am now slowly getting bit cautious on market for very short term.

This is not the place to buy fresh. For me risk reward ratio does not favour going fresh longs at current level especially for a short term trader. So I am just taking profits on table wherever it is available. One has to be very careful in terms of valuation and you have to now be cautious on market.

It is not time to buy anything but I agree with you in case of some quality mid and small cap, yes still there is lot of space and room left out. And large cap I am not finding any great risk reward trade or opportunity to go on long side. So I am bit cautious on market and I have mid and small cap positions which can do very good which are stock specific but I do not advocate fresh long for trades at current level. So I feel topping out signs for very short term around the corner.

But since I had Zee Entertainment on my radar and the other names as well any buy recommendations coming in, maybe the defence pack, maybe some of these gainers?
One has to be very stock specific and I am picking three stocks out of the big list what you gave so fast. And for me, number one stock in that will be Tata Motors.

Tata Motors will be the stock of the year. I have been telling this from levels around 400 and even now I am telling it will be the stock of the year.

So if I look at chart patterns of Tata Motors, yes post the fabulous result stock just made that move towards 525-530 zones, again consolidated, again now it is breaking out of that level of around 535 and clearly staying above that.
So for me, if someone has a long term horizon and at least one year if you can hold Tata Motors or even in F&O take long position and keep rolling over, I would not be surprised to see 700 rupees to come from current level which is another 150 points or another 30% away from current market price.

So I am looking at Rs 700 to come on Tata Motors in next one year. And in fact, that is a minimum target, it can even go beyond. And another stock from this list, what you have mentioned I am picking will be India Cements. Look at the chart structure of India Cements, it is now moving into that zone of Rs 225 and once it breaks that level of Rs 225, next halt will only be at Rs 250.

And clearly-clearly the stock has given breakout above levels of 200 so any small profit booking or any small dip you get in India Cements, it is not a buy but a great buy. I am looking at targets of 250 plus to come very soon on India Cements.

And the third one I pick from your list will be Zee. I know Zee has really disappointing and lot of people know that yes, this stock has lot of value in it, but it has not moved. But this time, I am looking at Zee to give a big, big move on the upside.

Initially, those who want to buy at current level, look at levels closer to Rs 230 to Rs 240 to come and post that, I would not be surprised to see Zee going even to levels of Rs 270 to Rs 280. In fact, it is a great-great risk reward buy at current level. I will be a buyer in Zee looking at initial targets of Rs 230-240, eventually Rs 270-280. And I won't be surprised to see Zee even beyond Rs 400 if someone has a good time frame to hold on to Zee.


We were talking about Piramal Pharma and Eureka Forbes. Both these stocks seem to have started making a move last week. Do you think the structure looks for a continued up move from here on? Can you check it out for us?
Piramal Pharma is such a wonderful stock to buy at current level. Piramal Pharma is a buy, buy, buy and look at the risk reward. This stock is now going above those levels of around 84-85 and giving me that entry also at current levels. So for me, keep a stop loss of around Rs 70 on Piramal Pharma. And I am looking at target of Rs 140 to Rs 150 which is another 70 to 80% from current market price.

And if you see the downside, it is hardly another 10 to 15%. So for me, Piramal Pharma looks a great buy. Look at target of Rs 140 to Rs 150. It is making a rounding bottom formation and it has given a clear breakout above Rs 85. There is a huge volume support as well as delivery buying happening in last one week. Stock is clearly getting accumulated on the chart and it has now given that breakout today.

So today this stock sustaining above 84-85 zone confirms to me that yes, the patterns are so-so positive for the stock to move towards Rs 140 to Rs 150 zone. Having a stop loss of 70, it is a great buy.

Now let us look at Eureka Forbes. This stock for me after a long time made a base formation at around Rs 350-Rs 360 zone. And then from there a non-stop move towards 500. So for me, if the same Eureka Forbes on chart, if you would have asked me somewhere closer to Rs 370 to Rs 400, I would have told great buy.

Even now it is a great buy, but I will wait for an entry. So that great entry can come closer to 450-460 zone. So wait for any profit booking or small dip on this stock.

And I will be a buyer in Eureka Forbes, but on a dip towards levels closer to Rs 450 and once it crosses decisively above levels of Rs 540, this stock can go towards Rs 700 to Rs 800 zone.

So I will either buy it once it closes above that 540 or on any dip to Rs 450 buy, look at target of Rs 700 to Rs 800. And for this stock, I will have a stop loss closer to Rs 430.