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!!

Crucial support for Nifty at 10094; 4 top stocks to buy or sell for handsome returns:

According to Technical Analysis , looks like the Nifty is trying to test the 10094 mark. The crucial support for the index is at 10094 and the resistance is at 10260-10300. Bank Nifty has support at 25000-25100 and resistance at 26600.The Nifty 50 started on a weak note on Thursday and succumbed under selling pressure after fiscal deficit at the end of October hit 96.1 percent of the Budget estimate for 2017- 18.

The Nifty 50 opened at 10,332 which also became the intraday high level. The index slipped near its crucial support level placed around 10,200 and hit its intraday low of 10,211. It closed 134 points lower at 10,226.55.

India VIX moved up by 3.75 percent at 13.55. Rising volatility has again given the grip in hand of bears which could pose a short-term concern for long positions.

The Nifty 50 futures on the Singapore Stock Exchange were trading 2 points higher at 10280 indicating a flat opening for the domestic market.

Two broad factors could turn out to be big wealth creators for investors; a) companies with old-style managements turning professional, and b) underestimation of long-term impact of reforms.

The smallcap czar further added the structural migration of the economy from black to white is tremendous. India, in terms of economy, is like a midcap when compared with the rest of the world, and in terms of per capita income as also the market cap, India falls in the smallcap category.

However, with India moving toward equal opportunity for every Indian, it will not remain a smallcap in terms of economy. We will go to midcap and then largecap.

Below are the stocks which are good trades today:

Jain Irrigation Systems: Indicator Buy | Rating: Buy | Target: Rs 128, stop loss: Rs 116

Nestle India: Base Formation | Rating: Buy | Target: Rs 7875, stop loss: Rs 7575

Tata Steel: Exhaustion | Rating: Sell | Target: Rs 675, stop loss: Rs 705

Yes Bank: Indicator Sell | Rating: Sell | Target: Rs 298, stop loss: Rs 310

MORE WILL UPDATE SOON!!

Market taking a breather, 9700 on Nifty key; see FY19 earnings at 18-20%

   

FY19 earnings could be anywhere between 18-20 percent and if those come through, then one could see selective opportunities in financials, consumer discretionary, autos etc.

The week gone by very difficult for bulls and the market was decisively down at the end of the week. It was a 2.6 percent cut for the week. Financials were the worst hit. Moreover, the market did not participate in the global run.

So to analyse the week gone by and what to expect from the market going forward,However, going forward in the coming months as people get confidence that recovery is building on itself, there are earnings upgrades, the market may take its next leg up in the first quarter of next year.

As people get more confidence on earnings recovery, there will be more allocation from foreigners towards emerging markets including India. Retail investors have also been increasing their allocation to domestic equities.

 FY19 earnings could be anywhere between 18-20 percent and if those come through, then one could see selective opportunities in financials, consumer discretionary, autos etc.

Gujral clearly believes the 10,100 on Nifty is just a formality and even if Nifty bounces, it will be a shallow one, so one should short it. 9700 on Nifty is the 200 day moving average and that becomes the port of call.

The Nifty Bank also looks vulnerable because it is sitting on a bigger rally and bigger out performance. Moreover, the negative news is also relative to financials and fiscal deficit etc. If Nifty gets to 9700, the Bank Nifty will be likely close to 24,000.

However, if people are still looking at buying opportunities when the market falls, then Rupa is a buy with a stop of Rs 470 and target of Rs 510. Jubiliant Life has also bottomed out, so it is a buy with stop of Rs 680 and target of Rs 715.

MORE WILL UPDATE SOON!!