IVRCL Infrastructure and Projects is good for the short term (2 days)

Unfortunately I was so much caught up with other things that I couldn't manage the time to write. I apologize to my readers for this reason. Now coming back to the topic I must say that this thread came in very late for those who would have been interested in the 1:1 bonus approved by the the BOD of this company. Well the company in question is IVRCL Infras. The record date for bonus is 19th of March 2010. So those who have bought this scrip atleast by yesterday can now enjoy the bonus. If you cannot get the bonus then what is the point of me spending some time and wasting some words by writing about this scrip. Well, all is not lost. First of all I would like my readers to know that I have been tracking this company for a long time now and I can surely say it's always a good idea to bet on this scrip. Therefore, I would suggest the ones with high risk tolerance to acquire this scrip now since it is bound to go up till 19th and exit on the day of "Record Date" itself. There is a clear pattern on the basis of which I can surely say that IVRCL looks like a very good short term bet. To start with I would first of all point out straight that the markets have gained heavily today:

Sensex
17383.18218.19 (1.27%)

Nifty
5198.1069.20 (1.35%)

CNX Midcap
7518.7547.75 (0.64%)

BSE Smallcap
8469.16106.96 (1.28%)

With the markets back on a short recovery path which is again a good sign as markets have been conservatively cautious and choppy since end of February, we have so far seen a very range bound performance on both the Sensex and the nifty. I think the markets will show a upward direction for the next few days and even if it didn't we would anyways see range bound activity. Thus what I'm trying to get across here is that the current movements of the indices is not going have much bearings on the price of IVRCL which is a strong player in the Civil Construction & Contracting Sector. Infact going with the tide, IVRCL closed at a high of above 3.5% today both on the BSE: 335.40 11.40 (3.52%) and the NSE: 335.30 11.55 (3.57%). Currently trading at just under 2.5 times of it's book value with EPS of 15.70 and P/E of 21.36 makes IVRCL a relatively cheaper and liquid stock. Now if we take a look at the 1 year chart of IVRCL as seen above and it's performance against Nifty we can see that overall it has performed at a better rate than the major index. We can also see that it is currently trading at a cheaper rate than it has traded over the period of past one year. I feel one should buy this share with a very short term view at CMP during tomorrow's trading session and exit on the 19th March with some good profit of Rs.25-40 per share in two - three days of trade. I would say one should look at picking it up at Rs.326-330 levels with a stoploss of Rs.323 and target around Rs. 346-360 by 19th March. For position traders who have not yet picked up this scrip I would advise to them to avoid for the time being and pick up once the bonus has been distributed and the stock price has settled down at it's new value (post split value). Then this stock will be highly VFM for a position trader with a long term view. I don't see this stock going down below Rs.155 even after bonus ( 1:1 split) in the long run. For position traders I would advise to wait till the end of this month and enter at Rs. 155-165 levels with a 6 month approach. Six month moderate target for this scrip will be above Rs.200.



Comments

Anonymous said…
nice n detaliled...unfortunately i dont know much shares n sensex....
nicely written though
abu
Soumya said…
Good Research . Keep up the good work.
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