F&O Alert: Top 8 stocks to track which could give up to 12% return in April series

The initial rollover data towards April series indicates long rollover in stocks. However, on any bounce in the prices, the Nifty index will face strong resistance at 10,250-10,300 levels. On the downside, the next support is placed around 10,100-10,050 levels.

  

The Nifty50 closed above its crucial 200-days exponential moving average (DEMA) and 200-days moving average (DMA) on Tuesday ahead of March expiry.

The recent move was largely led by short coverings which pushed the index back above 10,000 levels. The Nifty futures rollover suggest long positions are rolling forward which is a positive sign.

In recent short covering, call writers were once again seen active, as selling in 10,200 and 10,250 call strikes was observed which indicates that expiry might end up below 10,200 levels.

However, put writers are still holding sell positions in 10,100 and 10,000 put strikes which indicate expiry in the range of 10100 to 10,200 levels.

The initial rollover data towards April series indicates long rollover in stocks. However, on any bounce in the prices, the Nifty index will face strong resistance at 10,250-10,300 levels. On the downside, the next support is placed around 10,100-10,050 levels,” Shitij Gandhi, SMC Global Securities Ltd told Moneycontrol.

We have collated a list of top 8 stocks from different analysts which could give up to 12% return in April series:

Analyst: Shitij Gandhi, SMC Global Securities Ltd

Network18 Media & Investments Limited: BUY | Target: Rs 70| Stop loss: Rs 53| Return 18%

The stock has been continuously trading lower after testing Rs 62 levels in the recent past. However, prices took support at its 200-days exponential moving average on the daily interval and once again recovered back above its short-term moving averages to form Cup and Handle formation on a daily interval.

This week the breakout above the pattern formation has been witnessed which suggest for more upside in prices moving forward. So, traders can accumulate the stock in a range of Rs 59-60 levels for the target of Rs 70 and a stop loss below Rs 53.

(Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.)

Manappuram Finance Limited: BUY | Target: Rs 119| Stop loss: Rs 102 | Return: 10%

The stock has been consolidating in range of Rs 100-108 from last seven weeks alongside consistent buying at lower levels which formed the symmetrical triangle pattern on the daily and weekly interval.

This week the breakout above the pattern formation has been witnessed along with positive divergence on secondary indicators like RSI and stochastic indicators which supports for the next up move in prices.

Traders can accumulate the stock in a range of Rs 108-110 for the upside target of Rs 119 and a stop loss below Rs 102.

NTPC Limited: BUY | Target: Rs 187| Stop loss: Rs 161 | Return 10%

The stock has been trading down for the last three months and recently slipped below its 200-days exponential moving average on the daily interval to test Rs 160 level.

However, this month some lower levels buying was seen in the stock which took the prices once again above its 200 days exponential moving average.

Additionally, the stock has formed a cup and handle pattern on a daily interval which is a bullish signal for the prices. Traders can accumulate the stock in a range of Rs 170-171 levels for the upside target of Rs 187 with a stop loss below Rs 161.

Analyst: Abhishek Mondal of Guiness Securities

Bajaj Finance Ltd: Buy | Close: Rs 1772.45 | Target: Rs 1960 | Stop loss: Rs 1650 | Return: 10.58%

The stock has given a consolidation breakout above Rs 1740 level in the weekly scale after taking support around its 50-DMA.

The weekly Relative Strength Index (RSI) is showing upward momentum and the MACD is sustaining above the zero line and is trying to cross over the signal line whereas OBV — On Balance Volume continuously trading in a positive channel, which indicates that the stock has potential to move higher from current level.

Positional traders can buy the stock at current levels and add on dips around Rs 1745-1755 with a stop loss below Rs 1650 (closing) for a target of Rs 1960.

UPL Ltd: BUY | Close: Rs 736.80 | Target: Rs 800 | Stop loss: Rs 699 | Return: 8.55%

The stock has given a consolidation breakout on Tuesday above Rs 733 level with higher volume in daily scale. The Relative strength index (RSI) has given positive crossover and MACD continuously trading with positive crossover whereas +DI trading above -DI.

Traders can buy the stock in the range of Rs 730-737 with a stop loss below Rs 699 (closing) for the target of Rs 800.

Balkrishna Industries Ltd: Buy | Close: Rs 1095.15 | Target: Rs 1200 | Stop loss: Rs 1050 | Return: 9.59%

The stock has given a breakout from symmetrical triangle pattern above Rs 1085-1090 levels on Monday with higher volumes in the daily scale.

The Daily Relative strength index (RSI) showing upward momentum and +DI continuously trading above -DI whereas MACD trading with positive crossover.

Based on the above-mentioned observations traders can buy the stock in the range of Rs 1085-1095 with a stop loss below Rs 1050 (closing) for the target of Rs 1200.

Zee Entertainment Ltd.: Buy | Close: Rs 586.50 | Target: Rs 638 | Stop loss: Rs 560 | Return: 8.69%

In daily scale, ZEEL has taken support around its 200-DEMA and bounced back with higher volumes, which suggest that the stock has made a temporary bottom around Rs 550 levels.

The Daily Relative strength index (RSI) showing upward momentum and MACD trading with a positive crossover around zero line, which indicates the stock price has potential to move higher.

Traders can buy the stock in the range of Rs 580-587 with a stop loss below Rs 560 (closing) for the target of Rs 638.

LIC Housing Finance Ltd: Buy | Close: Rs 552.10 | Target: Rs 620 | Stop loss: Rs 512 | Return: 12.12%

The stock has given consolidation breakout on Monday with moderate volume in weekly scale. Weekly Relative strength index (RSI) making higher bottom while MACD has given positive crossover and are in Buy mode, which indicates that the stock price has a potential to move higher.

Traders can buy the stock around current levels and also add on dips around Rs 535-540 with a stop loss below Rs 512 (closing) for the target of Rs 620.

MORE WILL UPDATE SOON!!

Buy, Sell, Hold: 6 stocks are being tracked by analysts on March 28, 2018

Persistent Systems and ICICI Lombard, among others, are on investors’ radar on Wednesday.

BEL

Brokerage: Credit Suisse | Rating: Outperform | Target: Cut to Rs 175

The global research firm said that Q4 may reflect partial recovery. It sees 30% higher employee costs seem to be absorbed even as 9MFY18 margin is higher YoY. It is revising earnings estimates by 6 and 4 percent for FY18 and FY19, respectively.

Persistent Systems

Brokerage: Credit Suisse | Rating: Outperform | Target: Rs 960

Credit Suisse believes that its Q4 may be weak but medium-term story is intact. IP is a volatile element of the company’s business and hence can create nuances. It also continues to expect healthy revenue growth.

Brokerage: Morgan Stanley | Rating: Overweight | Target: Rs 1,025

The global brokerage firm said that the guidance for decline in IP revenue in Q4 has come as a negative surprise. It sees a potential 6% cut to FY18 EPS as most likely outcome.

ICICI Lombard

Brokerage: CLSA | Rating: Buy | Target: Rs 970

Over FY17-20, it sees 24% earnings CAGR led by premium growth & margin expansion. It expects the company to benefit from regulatory actions with the change in motor TP norms.

Motherson Sumi

Brokerage: Credit Suisse | Rating: Outperform | Target: Rs 440

The firm said that BS-VI implementation is likely to provide a big boost to wiring harness industry. It highlighted that the company is not too worried about topline slowdown at SMR and that it will return soon. For SMP, the margin can remain under pressure for few quarters as 2 large plants come on stream. It believes recent correction represents a good entry opportunity.

GSK Consumer

Brokerage: CLSA | Rating: Buy | Target: Rs 7,850

The brokerage said that acquisition of Novartis’ stake may lead to divestment of GSK Consumer. A change in ownership may increase focus & improve its growth trajectory. It added that the deal value will depend on distribution alliance.

M&M Fin

Brokerage: Deutsche Bank | Rating: Buy | Target: Rs 550

Recovery seems broad-based, with multiple growth drivers, it said, adding that the company has increased focus on CVs and used vehicles. Improving rural trends should result in better asset quality.

MORE WILL UPDATE SOON!!

Want to be a crorepati without much risk? Create this portfolio of mutual funds in FY19

If you are in the age bracket of 35-40 years and construct a portfolio which does not carry as much risk as direct equities then right fund selections across various categories should be able to do the job for you.

Indian markets surge to fresh record highs in the financial year 2018 before losing a bit of momentum. The index rose over 11 percent while many stocks gave multibagger returns.

But, stock picking could become a tiresome as well as a difficult process if you are not well versed in reading balance sheets or have no idea what about the dynamics of the equity markets.

Considering the fact that equity asset class is likely to deliver maximum returns when compared to other asset classes, ignoring it might not be the right idea.

Investors should use the opportunity of the dip and add mutual funds from across themes to make a stable portfolio which can help in wealth creation.

If you are in the age bracket of 35-40 years and construct a portfolio which does not carry as much risk as direct equities then right fund selections across various categories should be able to do the job for you.

“If the investor has long-term financial goals and no idea about how to invest in equities, equity mutual fund can be one of the best vehicles to achieve the goal. Unless you are an expert or are willing to spend considerable effort in becoming one, it doesn’t make sense to invest yourself— Equity funds are the right choice.

Looking at the current scenario, wherein investor is in the age bracket of 35-40 years, here’s how you can plan your portfolio:

  

Asset allocation is very crucial for making a stable portfolio. The allocation changes with time as and when the need of investors change. As long as the investor is in the age bracket of 30-50 years, investment in equities is the right bet.

It is very hard to time equity markets, but instead, investors could use mutual fund route where fund managers would be able to make the right choice for you – what to buy and when to buy?

One cannot change one’s asset allocation year on year. For a young person with limited short term liabilities, at least 60% of the money should be invested in Equities at all times. There is no point in timing the Equity markets as it just wouldn’t matter in the long term.

In the long term, the wealth creation would depend on the quality of stocks chosen and the underlying profit growth of those stocks. The stock prices and valuations both align to the Earning growth in the long term

Don’t be scared to step into equity markets here’s what experts suggest investors do with their portfolio in FY19:

Jagannadham Thunuguntla, Sr. VP and Head of Research (Wealth), Centrum Broking Limited

We recommend investors to allocate 50-60 percent of capital in largecaps, 20-40 percent in mid & small caps and 10-20 percent in thematic stocks.

Prasanna Pathak, Fund Manager, Taurus Mutual Fund:

Of the incremental savings, 30-40 percent should go towards safety to a combination of Bank FD, Liquid and Arbitrage schemes of Mutual Funds. 20-30 percent should go towards moderate safety with better return potential to a combination of options like Income schemes, Balanced schemes, and Gold.

Remaining portion should go to Equity schemes of Mutual Funds (diversified across the large cap, mid-cap, and small cap). The portfolio composition will change based on individual’s risk appetite, income levels, commitments and liabilities etc. One must visit a certified financial advisor for specific allocation advise.

Dipan Mehta, Director, Elixir Equities Pvt. Ltd

Almost 30-35 percent of the portfolio should be allocated towards Banks/NBFCs (private sector and retail focussed), 30-35  percent into consumer-oriented stocks (Auto, Retail, Aviation, Entertainment, Building material, and appliances), 15 percent in Capital Goods / EPC companies 5 percent in niche exporter / special situation.Hold Cash at 10 percent at all times to take advantage of extreme volatility which will be the highlight of the next 12-15 months.

MORE WILL UPDATE SOON!!