Chandan Taparia on January 25: Buy RIL, TCS, Yes Bank & sell Motherson Sumi

The latest analysis and commentary by stock market guru Chandan Taparia of Motilal Oswal Securities on what is moving the futures and options (F&O) markets today. Check out his top stock recommendations.

He spoke at length about Reliance Industries Ltd (RIL), Tata Consultancy Services (TCS), Yes Bank and Motherson Sumi.

“First trade is buy on RIL. The stock has seen the strong momentum. We have seen put writing activity in the counter and call unwinding has started to see. Although longs are being built, we may see some short covering as well. So recommending to go long on RIL with a stop loss of Rs 1,225. This stock has potential to move towards Rs 1,290-1,295 kind of levels with short covering activity. Second trade is buy on TCS. We have seen buying interest in selective IT counters, especially the Wipro, TCS, Tech Mahindra. TCS has seen some accumulation with open interest (OI) activity, so some upmove could be seen. One can buy with a stop loss of Rs 1,855 for an upmove towards Rs 1,985 to Rs 2,000 kind of levels. Third trade is sell on Motherson Sumi. This stock is having weakest structure, continuously making lower highs, lower lows, so shorts are intact, weakness could continue, one can sell on a small bounce back move with a stop loss of Rs 160 and on the downside it can again retest the recent swing low of Rs 146. One more trade is on the options side is on Yes Bank. On last trading session, the stock has seen the strong momentum, we have seen built up of long position by around 5-6 percent, the stock rallied by 9 percent, we are expecting short covering activity in the counter. We are recommending to trade with 220 call with a stop loss of Rs 4 and this call has the potential to move towards Rs 20-21 kind of levels,” he said.