Karvy Stock Broking Limited has maintained ‘buy’ rating on Cairn India stock with an intraday target of Rs 252.

According to Karvy, interested traders can purchase the stock between Rs 242-244 with a strict stop loss of Rs 240. If the stock market remains on positive track, the stock pricing becomes more attractive, and reach above Rs 255.
 
Shares of the company, on Monday (Sep 01), closed at Rs 248.05 on the Bombay Stock Exchange (BSE). The total volume of shares traded at the BSE was 706439. The share price has seen a 52-week high of Rs 342.50 and a low of Rs 136 on BSE.

The stock has great potential to rise as it showed good improvement in last few trading sessions. It will achieve the target price as the company has healthy growth plans and well-built operating capabilities.

The company’s (Cairn India) Rajasthan fields will create 16% extra oil at 175,000 barrels per day and will contribute over 1/5 of the country’s current domestic oil output, when it starts production during the second half of next year (2009).

The company has submitted a revised growth scheme for Mangala oil field, biggest in the Rajasthan block and has received investment authorization for the second largest field known as ‘Bhagyam.’

Moreover, the company’s remuneration committee, at its meeting held on Jul. 29, 2008, sanctioned the grant of 4,563,423 stock options to the eligible company’s staff.

The committee granted 3,773,856 options under Cairn India Employee Stock Option Plan (CIESOP) 2006 and 789,567 options under Cairn India Performance Option Plan (CIPOP) 2006.

On consolidated basis, the company, for the quarter ended June 30, registered a profit of Rs 1,385.80 million as against the net loss of Rs 714.40 million for the quarter ended June 30, 2007.

The company’s total income surged 65.72% to Rs 4,614.30 million for the quarter.

On the standalone basis, Cairn India’s quarterly loss widened to Rs 466.80 million, as against Rs 75.69 million during the corresponding period of the last year.

The company registered net loss of Rs 0.25 per share during the quarter. Net sales zoomed 2.69 times to Rs 9.70 million, whereas total income for the quarter climbed 2.55 times to Rs 225.80 million, when compared with the prior year period.

Other stocks from the same sector that looks good for short-term as well as long-term trading includes Reliance Natura, GAIL, ONGC and Shiv Vani Oil.