Identify the right pick

Deepak Spinners

The Rs 10 paid up share of Deepak Spinners fell to a low of only Rs 6.02 in March, 2009, when the Indian stock markets reached their final bottoms post the bubble burst of the unprecedented 2007-08 boom in the global stock markets. After bottoming out in March, 2009, in line with the general uptrend, the share continued to go up slowly but steadily and reached a multi-year new high of Rs 60 on Friday last week before closing at Rs 56.70 with a gain even in a week that saw the BSE Sensex losing over 1000 points.

Deepak Spinners is a company that has posted profits at net level in the past many years but not obliged its shareholders with dividend payment as it shells out higher amount for interest payment than net profits year after year. However, the textile and related industries were expected to be doing well over the past many months and the company is therefore expected to come out with good working results and also a dividend for its shareholders this year and that is perhaps helping its share to maintain its uptrend on its daily and weekly chart. The uptrend is likely to remain and it can also jump up if the company comes out with a dividend announcement for its shareholders. The share is therefore suggested to be picked up for medium-term investing.

NMDC

Public sector National Minerals Development Corporation (NMDC) is into iron ore and other mining activities which suffered severe setback due to global recession in the past couple of years. The company is, however, reportedly recovering from the recession of last year and that has started showing on its daily chart.The Re one paid-up share scaled to a high of Rs 196.16 in June, 2014, and thereafter entered a one-sided downtrend that gradually pushed it down to Rs 123 on March 26, 2015. The share at such low price attracted value buying and rose to Rs 139 in just 10 trading sessions on April 13.

But by then the markets turned extremely bearish so the share could not go further up but fell back to a low of Rs 124.10 on Thursday last week before rising to Rs 129.30 and closing at Rs 128.60 on Friday against the general downtrend in the markets. This is a chart indication that suggests that given a positive trend in the markets, this could go further up. The share is therefore suggested for buying for short to medium-term investing.

Supreme Industries

Supreme Industries is into plastic processing company and construction activities. It rewarded its shareholders very generously by making many bonus share issues ever since it came into existence and has been paying handsome dividends too, and therefore, enjoys a status of being a darling of the long-term investors.

The share of this company fell to a low of Rs 568 in mid-January, 2015, and thereafter rose to a high of Rs 741.90 on March 18. Increased selling in the form of profit-booking coupled with a change in the general trend of the market from bullish to bearish sent it back but only up to a low of Rs 682.90 in just 10 trading sessions. At such low price, it once again attracted buying and scaled to a life-time high of Rs 745 on April 10.

The market, by this time, turned extremely bearish so the share could not make further progress and instead corrected up to a low of Rs 641.15 by Tuesday last week. However, being basically bullish scrip, it could not remain depressed for long and instead jumped up to a high of Rs 690.05 on Friday last week before closing at Rs 669.25 even when the markets fell by over 1000 points this week. The share has thus displayed distinctive individual strength and therefore should be bought for medium-term investment.