Amit Gupta of ICICIdirect recommends buying Bajaj Auto, Canara Bank and Zee Entertainment.
Amit Gupta of ICICIdirect told CNBC-TV18, "PSU banks are looking much better because on the day when there was re-capitalisation news we saw almost Rs 3,600 crore of FII buying after a long time. It means they have also bought into the PSU banking space."
"We have seen Canara Bank's Put base increasing at Rs 370-380 levels, so we are recommending 380 Put to be written which is somewhere around Rs 3.50-4.50 of premium. I think in the coming six or seven sessions because that stock came down to Rs 390 and then reverted back towards Rs 400 levels once it is above Rs 400, I think it maybe a good trade where these premiums can be written and eventually it will be zero."
"So in Bank Nifty and particular in PSU banking space, we are going with this kind of Put writing scenario."
"Bajaj Auto for the last one year was within Rs 2,800- Rs 3,000 to 3,100 levels. It has given a good breakout, the volumes have been very supportive and if you look at the open interest it had come down to multi month low."
"It was only 1 million shares but now it has been increasing. It has increased to 1.5-1.6 million and I think these are long formations which are coming in the stock. Previously we saw TVS Motor or Hero MotoCorp performing but now I think it is clear shifting of money into Bajaj Auto which can take it towards Rs 3,500-3,550 levels. We remain positive."
"Bajaj Auto has been a performer in this series, but it is likely to be performer in the coming series as well. So one can start forming positions in it."
"Another one is Zee Entertainment. Yesterday it was almost 14-15 percent of addition on the long side. For the coming six sessions, I think this momentum may be there looking at the premium which are still very high. So 560 Call option I think is available at Rs 12-13 because people are buying the Call options now. That is why it can move towards Rs 24 or 25 levels. We can play this long call by buying Call option trade for this particular expiry in which is 560 Call," he added.
