Technical analyst, Ashwani Gujral is of the view that investors can buy Reliance Power stock to achieve a short-term target of Rs 460.

According to him, investors can purchase the stock on declines with a stop loss of Rs 400.

The investors can achieve the target within a period of 4-5 weeks. So they are advised not to sell the stock before achieving this price target.

Today, the company’s shares opened at Rs 420, as against its last closure at Rs 419.80 on Thursday (May 8), on the Bombay Stock Exchange (BSE). The share price has seen a 52-week high of Rs 599.0 and a low of Rs 303.45 on BSE.

For the year ended Mar. 31, 2008, Reliance Power has posted consolidated net profit of Rs 853.8 million on total income of Rs 1,328.92 million.   
On standalone basis, the company has registered a net profit of Rs 946.68 million on total income of Rs 1,328.674 million for the year ended March 2008.

Reliance Power, which lifted Rs 115.62 billion through its initial public offering (IPO), has temporarily parked almost the entire money in mutual funds.

The declaration of 2007-08 financial results showed that Rs 114.13 billion is invested in mutual funds. However, the company has not revealed either the funds or the schemes where the money has been invested.

The company has spent only Rs 258.3 million as of Mar. 31, 2008 in construction and development of its various projects. The temporary parking of the IPO money in mutual funds has helped the company report a net profit of Rs 946 million for 2007-08. Total income for year stands at Rs 1.33 billion, of which dividend income is Rs 1.13 billion.

Other stocks from the same sector that looks good for short-term trading includes NTPC, Reliance Infra and Tata Power.