Buy Sun Pharma and Divis Lab; Sell Tata Motors

The stocks below are the top picks for the day that offer a wide array of choices to retail as well as long-term investors.

Sun Pharma (Buy above Rs 504; target Rs 520)

Sun Pharma opened weak on Friday, in line with the market, but it closed higher on very high volumes as the stock was included in the BSE Sensex from 8 August , 2011. Though it is expected that markets might fall in line with the US downgrade, the stock, being viewed as a defensive pharmaceutical sector play and its inclusion in the indices, can find some buying.

[caption id=“attachment_55823” align=“alignleft” width=“380” caption=“Sun Pharma closed higher on very high volumes as the stock was included in the BSE Sensex from 8 August. Reuters”]  [/caption]

Divis Lab (Buy above Rs 807.70; target Rs 825)

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Divis announced a very good set of numbers on Saturday, with a strong bottomline growth despite taking an one-time write-off. The stock has shown strength of late with a series of upgrades from analysts. On a defensive play, the stock can be tried out.

Tata Motors (Sell below Rs 870; target Rs 850)

Though Tata Motors bounced back from its previous low of Rs 870, the rise has been on low volumes. Furthermore, with government contemplating higher duty on diesel vehicles, the stock can remain under pressure for some time. Also, the US and Europe crisis does not augur well for the stock.

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