Identify the right pick
Alpha-Geo Ltd. is a company that is engaged in the geological surveys and related activities in India. The company has a positive track record of...
Alpha-Geo Ltd. is a company that is engaged in the geological surveys and related activities in India. The company has a positive track record of financial performance over the past two decades, generally. Its share had risen to an all-time new high of Rs 1078.80 during the unprecedented stock market boom in 2007-08. But when the markets ceased to be bullish and came under the devastating impact of the bear market that followed, it plunged to a low of Rs 69.35 in March, 2009. From March, 2009-bottom, the share rose to a high of Rs 283.15 but the general conditions in the markets still being bearish, it started to going down and ultimately fell to a new low of Rs 21.05 about five weeks ago.
At such a low level of prices, the share discounted the worst and started to gathering strength in the following weeks. In the process, the share grtadually moved up and reached a high of Rs 32.90 during the last week and also closed at that level which was a buying circuit for Friday, the last trading day. This means that the demand for this scrip far exceeded the supply and therefore, there is a possibility of it going further up. Even otherwise, the share at current price levels, is going for a song and should be bought for medium to long-term investing.
Kesoram Industries is a Birla Group company and engaged in varied business activities including tyre and cement manufacturing. The financial performance of the company has been generally good in the past few decades. The share of this company had scaled to an all-time high of Rs 675.00 in 2007-08 when the stock markets were on fire. The markets, however turned extremely bearish after they established their all time new highs, and got wrapped with severe bearish trend which pulled this share down to a low of Rs 102.70 in March, 2009.
From March, 2009 onwards, the share in line with the general markets, rose to a high of Rs 418.60 but before it could go further up, the markets once again came under the impact of a long lasting bearish trend that took it down, first to a low of Rs 83.00 and ultimately to a low of Rs 50.25 a couple of weeks ago. The share at that low price seemingly discounted all the worst and looked ripe to go up. With the markets turned positive during the last week, it jumped up to a high of Rs 59.80 before closing at Rs 58.25 which is just a few paise lower than its short-term moving average. The share, if crosses this short-term moving average in the new week, which is quite possible in the changed market conditions, then a jump could be possible. It is better to pick this share up before it breaks above the short-term moving average and runs up.
Engineers India which is generally referred to as EIL by its short form is a public sector enterprise (PSU) owned by the central government. The company has a very good past track record of financial performance and rewarding its stakeholders with liberal bonus share issues and regular dividend payments at really high rates. The share of this company had scaled to an all time high of Rs 538.00 on ex-bonus basis but when the markets turned bearish, it declined to a low of Rs 311.10 only to bounce back up to a lower peak of Rs 372.65 thus forming a bearish pattern on its weekly chart.
The bearish pattern coupled with the general downtrend that set in the markets and also distress selling of some of the other PSU shares at throw away prices by the government, forced this stock to go on losing in phases and land up to a low of Rs 121.15 about three weeks ago.
This being an opportunity of picking up a blue chip public sector unit, was grabbed by many bargain hunters who not only helped the share to stabilize but also floor-lift it up to a high of Rs 169.10 before closing at Rs 168.15, well above the short-term and the medium-term moving averages, thus signalling a further appreciation in its quotations in a market that is not specifically not too bearish. The share is therefore, suggested for buying for medium to long-term investing.