Which Stocks to buy for safe returns in Bears Vs Bulls Market?

 

Symphony: BUY| CMP Rs1632| Target Rs1920| Stop Loss Rs1490| Return 18%| Time Frame 6 month

The share price of Symphony remains in a long-term structural uptrend as defined by the rising peaks and troughs on the long-term price charts.

The recent price action has resulted in a breakout from the major consolidation of over two years thereby signalling the resumption of a primary uptrend and provides fresh entry opportunity to ride the next up move over the medium term.

The entire secondary consolidation phase since the life-time high of Rs1637 in April 2015 till date represents a bullish Cup & Handle formation as highlighted in the adjoining weekly chart.

A cup and handle formation is a bullish continuation pattern, which marks a secondary corrective phase within the larger degree uptrend.

The strong up move in the current week has led the share price above the neckline of the bullish cup and handle pattern around Rs1550, thereby, signalling the end of the long-term consolidation phase and implies resumption of the primary uptrend.

Based on aforementioned technical observations, we believe the stock is likely to test levels of 1925 being the minimum measuring implication of the bullish cup and handle pattern i.e. the width of the handle (1570-1215=355 points) as projected from the breakout point of Rs1550 provides upsides towards 1925 over a medium-term horizon

GlaxoSmithKline Consumer: BUY| CMP Rs6109| Target Rs6700 | Stop Loss Rs5780| Return 10%| Time Frame 6 months

The share price of GlaxoSmithKline Consumer remains in a structural uptrend as it continues to stride northward in a rising peaks and troughs manner. Currently, the stock is seen emerging out of a two-year-long corrective phase that forms part of the larger degree uptrend.

We believe the stock is set to embark upon its next major up move, going forward. Therefore, it provides a good buying opportunity for medium-term investors

The stock entered into a secondary corrective phase after hitting a lifetime high of Rs6800 in December 2015. The price wise correction halted precisely near the key value area of Rs4900 being the 61.8% Fibonacci retracement of the 2013-15 rally (Rs3800 to Rs6800).

The stock witnessed a steady base formation around Rs4850-4900 region towards the end of 2016 before gradually rising to a high of Rs5780 by August 2017. The ensuing correction saw the share price once again revisit the value area of Rs4850-4900 in September 2017.

The two identical lows formed in December 2016 and September 2017 represent a bullish Double Bottom formation highlighting strong demand at the key value area.

We believe the stock has concluded a healthy corrective phase and is set to embark upon its next up move going forward. We expect the stock to head towards our target of Rs6700 in the medium term as it is the measuring implication of the Double Bottom pattern i.e. the neckline and base of the pattern (5780-4850=930 points) added to the breakout point of Rs5780 projects upside towards Rs6700.

South Indian Bank: BUY| CMP Rs33.00| Target Rs38| Stop Loss Rs30| Return 15%| Time Frame 3 months

South Indian bank has been in a steady uptrend in the CY 2017 characterized by sharp rallies and shallow corrections signalling positive price structure.

The stock on Wednesday’s session registered a resolute breakout above a falling trendline joining the highs 25th October 2017 (Rs33.25) and 21st November 2017 (Rs32.15) signalling a resumption of up move after last two months consolidation.

The breakout from the trendline resistance was accompanied by a strong volume of almost double of the 200 days average volume of 1.6 crores signalling larger participation in the direction of the trend.

We expect the stock to rally towards 38.00 in the coming months being the 138.2% price extension of the previous up move from Rs27.40 to Rs33.25 as projected from the recent trough of Rs29.70 signals upside towards 38.00 in the short term.

OTHER NOTABLE PICKS:

There is lot of action around specialty Chemicals. Porinju recently picked up stake in Ashapura Minechem. The firm has purchased 7.42 lakh shares (representing 0.85 percent of total paid-up equity) of the company via an open market transaction on November 16.

Equity Intelligence's shareholding in the company increased to 5.35 percent from 4.5 percent earlier. Ashapura Minechem has niche products with revenue of over Rs 1,000 crore. However, it might not be a good buy at current levels after a brief rally that we saw soon after Porinju picked up stake.

Tata Coffee and Tata Global Beverages

Both Tata Coffee and Tata Global Beverages are my important picks and Tata Global is the leader in the country. The consumption story will always click on D-Street. The stock doubled in the last five months.

Future Group companies: Most of the future group companies have done extremely well. Most of them have given about 200 percent return in the year 2017.

Infrastructure sector

If we look at the next 5-10 years infrastructure is one sector which is likely to get a big boost. The market cap of all the companies in the sector it comes to be around dew billion dollars which is too small. This market cap could be 5x-10x from current levels – could be a function of new companies entering the sector.

Logistics

Logistics sector has a long way to go. The market cap of India’s logistics sector is too small.

UFO Moviez India

In the media space, Porinju likes UFO Moviez. Recently, they have decided to merge with Chennai-based Qube Cinema Technologies to solidify its position in the digital cinema distribution and in-cinema advertising spaces.

The business could give about Rs1000 crore turnover and the market cap is 1x revenue. It is a very niche business with the potential to improve further. It is a good stock, but investors need not have to go and buy today.

MORE WILL UPDATE SOON!!