Saturday, September 5, 2009

PORTFOLIO ANALYSIS - SAMPLE 3 ( X-4 )

Like photons of light, the next packet of Mr X's portfolio analysis is here to focus on Banking stocks. During the course of analysis one singular thought that goes through mind is that the banking stocks are likely to dip sharply in very short term. Notwithstanding that, one sees a bright future for the banking sector in medium to long term. Just take a look.

STATE BANK OF INDIA
Holding 78 shares @ 1340. CMP- 1762.45
6 mnth tgt- 2300, 1 yr tgt- 3200
SBIN has corrected 38.2% so far and has yet to cover its gap at 1380. So it would be no surprise if it gravitates to 1380 in near term. Since you are sitting on profit it would be advisable to quit your position at current market price. Enter SBIN again at 1400 level for a period of 6 months in order to maximise your profits.

BANK OF BARODA
Holding 50 shares @ 327. CMP- 427.3
6 mnth tgt- 550, 1 yr tgt- 800
Bank of Baroda has corrected just about 38.2% but has not covered its gap at 350. In days ahead it may correct to 330. Here you may like to book your profit and again re-enter once the scrip visits the level of 350. Then you would be well advised to keep the stock for a period of 6 months.

PNB
Holding 71 shares @ 395. CMP- 681.35
6 mnth tgt- 850; 1 yr tgt- 1200
PNB has not corrected sufficiently enough and may do so now. Take your profit home at CMP, since it may correct to 500 level. After that you may like to trade for different targets given above.

ALLAHABAD BANK
Holding 1925 shares @ 82. CMP- 93.15
6 mnth tgt- 110; 1 yr tgt- 140
Allahabad Bank has just about corrected to 38.2% , but still not covered its gap at 61. It will therefore be no big surprise to find the scrip tumbling to 60 in coming days. My advice would be to book profit in your position and wait for 60 level to re-enter. You can then begin your trading for different targets given above.

ICICI BANK
Holding 176 shares@ 880. CMP- 743.9
6 mnth tgt- 950, 1 yr tgt- 1400
There is an uncovered gap at 579 and ICICI Bank has not corrected enough to touch even 38.2%This is a tricky situation where analysis says that ICICI bank should correct to 520 in near term and you are presently in loss. Of course you can simply wait for six months to liquidate your position at 950. The other way round is to sell 56 shares at current market price and take a chance by booking this loss. In case the scrip does not correct then your holding of 120 shares will cover the loss you would have made in 56 shares by exiting at 950. But if ICICI does correct as I am foreseeing then you will have a chance to enter at 520 level, thereby giving you an opportunity to bring down your buy price in the scrip.