Nifty likely to hit 11,100 levels ahead of expiry; 5 stocks which could give up to 20% return

The derivative data indicates that bullish scenario is likely to continue with Nifty having multiple strong supports at lower levels around 11000 & 11030 spot.

   

The Nifty is once again trading near all-time highs, and at current levels, derivative data reflects that still there is a lot of short position in Nifty futures and the index calls is outstanding.

Moving forward, we can expect another round of short covering as per current derivative data which could push the index towards 11150-11200 mark this week as the market undertone remains bullish with the support of consistent long buildup and short covering.

The derivative data indicates that bullish scenario is likely to continue with Nifty having multiple strong supports at lower levels around 11000 & 11030 spot.

Currently, Nifty is moving up, with a decent addition in the open interest which indicates strength in the current trend. Option writers were seen active in the recent rally as we have seen put writing in 10800, 10900 & 11000 strikes along with the unwinding in calls.

We have been continuously seeing open interest addition post expiry which indicates long buildup. On the technical front, 11000-10980 spot levels are strong support zone and the current trend is likely to continue towards 11150-11200.

Here is a list of top 5 stocks which could give up to 20% return in the short term:

Automotive Axles Limited: BUY| Target Rs 1980| Stop Loss Rs 1575| Return 15%

The stock has given a breakout above Rs1500 levels in the recent past on the daily charts. Since then it has been consolidating in the range of 1650-1750 and formed a bullish flag formation on the daily interval.

In Tuesday’s session, the stock witnessed a fresh breakout above the pattern formation along with marginal higher volumes. Traders can accumulate the stock in a range of Rs1720-1740 for the target of Rs1980 with a stop loss below Rs1575.

Sasken Technologies Limited: BUY| Target Rs 895| Stop Loss Rs 700| Return 16%

The stock is maintaining its Bull Run and forming higher highs and higher lows on the daily and weekly interval. However, from last three weeks, prices were seen consolidating in range of 720-775 with consistent buying at lower levels.

This week stock has given consolidation breakout above the recent range along with positive divergence on the relative strength index (RSI) and stochastic indicator. Traders can accumulate the stock in a range of 770-785 for the upside target of 895 with a stop loss below 700.

Sterlite Technologies Limited: BUY| Target Rs 464| Stop Loss Rs 340| Return 20%

After recent breakout above 300 levels stock risen sharply and tested 400 levels in short span of time. At current juncture stock has formed diamond pattern formation on daily charts and given breakout above the same this week.

Moreover, a sudden rise in volume along with rising price reflects strength in the current trend. So, traders can accumulate the stock in a range of 385-395 for the target of 464 with a stop loss below 340.

Escorts Limited: BUY| Target Rs 888| Stop Loss Rs 750| Return 11%

The stock has been trading in a rising channel on the weekly interval and has formed higher highs and higher lows. On the daily charts, the stock has retraced back towards its 50-days exponential moving average due to profit booking and took support thereon.

Once again we saw a fresh break above the falling trend line has been seen as once again prices risen sharply above its short-term moving averages. Traders can accumulate the stock in a range of 800-811 for the target of 888 with a stop loss below 750.

Varun Beverages Limited: BUY| Target Rs 800| Stop Loss Rs 635| Return 15%

The stock has risen sharply in the recent past from Rs520 levels to Rs720 levels in a short span of time. Since then, the stock retraced most of the gains and took support around 625 levels.

Due to recent retracement, the stock has formed a bullish flag formation on the daily interval. This week, the upside breakout has been witnessed above the pattern formation along with hefty volumes. Traders can accumulate the stock in a range of 695-710 for the target of 800 with a stop loss below 635.

MORE WILL UPDATE SOON!!

Failure to cross 11,100 could trigger profit booking; 3 stocks which could give up to 26% return

Failure to cross 11,100 can trigger profit booking dragging the Index lower to levels of 10,500-10,250. The Bank Nifty is also showing strength making new highs which can take the headline Index Nifty to 11,100 to 11,400 levels.

  

The Nifty index gained further momentum extending its 3rd impulse wave to make new all-time highs. Further, following this sharp up-move it is approaching its upper end of the rising channel resistance placed in the zone of 11,000-11,100.

Moreover, 161.8% extension of the wave 1 (i.e. 6833-8994) is placed at 11,400. Partial profit booking is advised as the Index approaches 11,400.

Further, the relative strength index (RSI) continues to form higher highs in line with price making higher highs affirming the strong bullishness dominant at the moment.

Failure to cross 11,100 can trigger profit booking dragging the Index lower to levels of 10,500-10,250. The Bank Nifty is also showing strength making new highs which can take the headline Index Nifty to 11,100 to 11,400 levels.

Here is a list of top 3 stocks which could give up to 26% return in the next 3-4 weeks:

Laurus Labs: BUY| Target Rs 620| Stop Loss Rs 520| Return 13%

On the weekly chart, Laurus Labs Ltd has broken out of a Triangle pattern (as indicated on chart). A sustained trade above Rs554 i.e. recent highs on higher volumes may trigger a bullish breakout.

On the daily chart, the stock is oscillating in a Pennant pattern after taking support at 61.8% Fibonacci retracement level affirming start of a bull trend on cards.

RSI has formed a positive divergence with respect to price after taking support at the 40 level. The stock may be bought in the range of 545-550 for targets of 595-620, keeping a stop loss below 520.

Prism Cement Ltd: BUY| Target Rs 180| Stop Loss Rs 124| Return 26%

On the weekly chart, Prism Cement Ltd has broken out from an ascending triangle pattern triggering a bull trend reversal. The neckline of the pattern is placed at Rs130, and a sustained trade above the neckline with healthy volumes can extend the up move.

On the daily chart, the stock is on the verge of a breakout from a flag pattern suggesting bullishness building up.

The RSI has turned upwards breaking out of the upper band of the Bollinger Bands suggesting higher levels in the coming trading sessions. The stock may be bought in the range of 140-144 for targets of 170-180, keeping a stop loss below 124.

Wonderla Holidays Ltd: BUY| Target Rs 477| Stop Loss Rs 380| Return 15%

On the weekly chart, Wonderla Holidays Ltd has broken out from a channel pattern triggering the start of a bull trend. Further, it has broken out of the channel after 2 years of consolidation strong upside momentum.

On the daily chart, is continues to form higher highs and higher lows affirming bullishness. Further, RSI has also broken down from the lower Bollinger band suggesting lower levels. The stock may be sold in the range of 412-417 for targets of 456-477, keeping a stop loss below 380.

MORE WILL UPDATE SOON!!

Netflix lifts S&P, Nasdaq; J&J, Procter hold Dow in check

The Dow Jones Industrial Average fell 3.79 points, or 0.01 percent, to 26,210.81, the S&P 500 gained 6.17 points, or 0.22 percent, to 2,839.14 and the Nasdaq Composite added 52.26 points, or 0.71 percent, to 7,460.29.

  

US stocks advanced on Tuesday, as strong results from Netflix helped lift the S&P and Nasdaq Composite, but the Dow Industrials were hemmed in by declines in Johnson & Johnson and Procter & Gamble.

Netflix touched a record high of USD 257.71 and was last up 9.98 percent at USD 250.29, to cross the USD 100 billion market value threshold. The video-streaming pioneer beat Wall Street targets for new subscribers in the fourth quarter.

Other stocks known as part of the "FAANG" group - Facebook, Apple, Amazon and Google parent Alphabet - also moved higher.

Insurer Travelers provided the biggest boost to the Dow, up 4.96 percent after profit topped estimates.

There has not been another time in this recovery where Main Street was doing well, where every economy in the world was doing well, and where so far there isn‘t really an overwhelming show that we have a significant inflation or interest rate problem which would mandate a valuation change.

Paulsen cautioned, however, that as the rally continued more challenges were mounting that could cause a pullback. "If it ever does turn, there could be a fair amount of correction," he said.

The S&P 500 has reached a streak of 396 trading days without a 5-percent correction, according to LPL Financial, the longest on record. The benchmark index has closed within 5 percent of a record in 467 of the past 468 trading days.

S&P 500 earnings growth for the fourth-quarter is expected at 12.4 percent, according to Thomson Reuters data through Tuesday morning. Of the 68 companies in the benchmark index that have posted results, 76.5 percent have topped Wall Street expectations.

The Dow Jones Industrial Average fell 3.79 points, or 0.01 percent, to 26,210.81, the S&P 500 gained 6.17 points, or 0.22 percent, to 2,839.14 and the Nasdaq Composite added 52.26 points, or 0.71 percent, to 7,460.29.

Johnson & Johnson fell 4.26 percent, dragged down by a USD 13.6-billion charge related to the new US tax law and a court ruling on a crucial patent on its blockbuster rheumatoid arthritis drug Remicade.

Procter & Gamble dropped 3.09 percent as investors focussed on a drop in gross margins at the world's largest consumer goods maker.

US President Donald Trump on Monday approved steep import tariffs on washing machines and solar panels, a move that was criticized by China, South Korea and Europe and stoked fears about potential retaliation.

In the wake of the tariffs, shares of Whirlpool rose 3.20 percent and smaller solar names such as Real Goods Solar , up 33.04 percent and Sunworks , up 10.71 percent, moved higher.

Verizon slipped 0.43 percent as its quarterly profit fell short of Wall Street estimates but revenue beat expectations as it added phone subscribers.

Advancing issues outnumbered declining ones on the NYSE by a 1.60-to-1 ratio; on Nasdaq, a 1.28-to-1 ratio favoured advancers.

The S&P 500 posted 135 new 52-week highs and 1 new low; the Nasdaq Composite recorded 232 new highs and 16 new lows.

Volume on US exchanges was 6.78 billion shares, above the 6.38 billion average for the full session over the last 20 trading days.

MORE WILL UPDATE SOON!!

Asia shares surf global growth wave, dollar sinks

Most Asian stock indices are up anywhere from 5 to 10 percent since the start of the year with many at all-time highs.

   

Asian shares scaled record peaks on Wednesday as strong corporate earnings and optimism on global growth outweighed concerns over trade tensions, while a fresh burst of speculative selling took the U.S. dollar to three-year lows.

A 10 percent surge in Netflix led gains across the tech sector as it became just the latest to top forecasts. So far, 82 percent of reporting companies having beaten estimates.

Most Asian stock indices are up anywhere from 5 to 10 percent since the start of the year with many at all-time highs.

These markets are absolutely flying and have had seemingly one-way moves since late December.

There has clearly been a wall of capital hitting these markets, as is the case with many Asian currencies," he added. "One simply can't rule further upside here, even if there is growing risks of buyers fatigue kicking in."

Early Wednesday, MSCI's broadest index of Asia-Pacific shares outside Japan had inched up 0.1 percent, having jumped 1.2 percent on Tuesday.

Japan's Nikkei edged down 0.4 percent as the yen strengthened, but that was from a 26-year top.

Investors seemed to have shaken off worries about a trade war, sparked when US President Donald Trump's slapped steep import tariffs on washing machines and solar panels in a move condemned by China and South Korea.

China's blue-chip CSI300 index had ended Tuesday at its highest since mid-2015 having climbed almost 9 percent for the year so far.

On Wall Street, the beat by Netflix helped lift tech shares, though the Dow was hemmed in by declines in Johnson & Johnson and Procter & Gamble. The Nasdaq gained 0.71 percent and the S&P 500 0.22 percent, while the Dow edged down a slim 0.01 percent.

EUROPE ON A ROLL

In currency markets, the dollar remained under fire as investors wagered the Federal Reserve would be far from the only central bank to tighten this year as growth spread more widely.

The sea change has been greatest in Europe where a survey of consumers overnight showed confidence jumped to a 17-year high in January.

Both investors and consumers in Europe have started 2018 in a cheery mood, as the rotation away from the US as the epicentre of global growth continues.

The upbeat data only reinforced speculation the European Central Bank might take a step towards an eventual tightening at its policy meeting on Thursday.

That helped lift to euro to USD 1.2312 and back towards the three-year top of USD 1.2322 touched last week. The dollar was already at a fresh three-year trough against a basket of major currencies at 90.003 .

It also ran into selling against the yen even though the Bank of Japan tried hard on Tuesday to quash talk it might curb its massive asset buying campaign anytime soon.

The dollar was last down 0.1 percent at 110.16, having hit its lowest since September at 110.06.

The British pound also powered past USD 1.4000 to its highest since the vote to leave the European Union in June 2016, aided by optimism around Britain's chances of securing a favourable Brexit deal.

The dollar's decline has been a boon to commodities priced in the currency, with gold edging up to USD 1,341.56 an ounce.

Oil prices were consolidating after jumping more than 1 percent on Tuesday, with benchmark Brent crude hitting USD 70 a barrel for the first time in a week.

Brent futures were yet to trade at USD 69.96, not far off the three-year high of USD 70.37 reached on Jan. 15, while US crude added another cent to USD 64.48 a barrel.

MORE WILL UPDATE SOON!!

What changed for the market while you were sleeping? 12 things you should know

A list of important headlines from across news agencies that could help in your trade today.

   

The Nifty, which started on a flat note on Monday tracking muted trend seen in other Asian markets, recouped morning losses and ended at yet another record closing high making a strong bullish candle on the daily candlestick charts.

The index, which opened at 10,883, slipped marginally to an intraday low of 10,881.40. The bulls quickly took control and pushed the index to a fresh intraday high of 10,975.10. The index finally closed 71 points higher at 10,966.20.

According to Pivot charts, the key support level is placed at 10,906.7, followed by 10,847.2. If the index starts to move higher, key resistance levels to watch out are 11,000.4 and 11,034.6.

The Nifty Bank closed at 27,041.2. Important Pivot level, which will act as crucial support for the index, is placed at 26,896.63, followed by 26,752.06. On the upside, key resistance levels are placed at 27,130.33, followed by 27,219.47.

Stay tuned to Moneycontrol to find out what happens in currency and equity markets today. We have collated a list of important headlines from across news agencies.

Stocks hit record as US markets end higher

US stocks advanced on Monday as each of Wall Street’s main scored records in the wake of a deal by US senators to end the federal government shutdown. The Dow Jones Industrial Average rose 142.88 points, or 0.55 percent, to 26,214.6, the S&P 500 gained 22.67 points, or 0.81 percent, to 2,832.97 and the Nasdaq Composite added 71.65 points, or 0.98 percent, to 7,408.03, Reuters reported.

Asian shares gain following firm US lead

Major Asian indexes rose on Tuesday following the stronger lead from Wall Street after U.S. lawmakers reached a deal to end a government shutdown. Japan's Nikkei 225 rose 0.64 percent in early trade while the Kospi added 0.36 percent as automakers traded mostly higher on the day, CNBC reported.

SGX Nifty

Trends on SGX Nifty indicate a positive opening for the broader index in India, a rise of 40 points or 0.36 percent. Nifty futures were trading around 11,007-level on the Singaporean Exchange.

Republicans, Democrats reach deal to end US govt shutdown

Congress voted on Monday to end a three-day US government shutdown, approving another short-term funding bill as Democrats accepted promises from Republicans for a broad debate later on the future of young illegal immigrants, reports Reuters.

NPAs to rise to Rs 9.5 lakh cr by March-end: Report

India's banking sector will be saddled with gross non-performing assets (GNPAs) worth a staggering Rs 9.5 lakh crore by March-end, up from Rs 8 lakh crore in the year-ago period, said the Assocham-Crisil study.

"The recovery rate, which is a good indicator of the effectiveness of ARCs is expected to rise from 38 per cent earlier to about 44-48 per cent," it said.

India to grow at 7.4 percent in 2018: IMF

India is projected to grow at 7.4 percent in 2018 as against China's 6.8 percent, the IMF said on Monday, making it the fastest growing country among emerging economies following last year's slowdown due to demonetisation and the implementation of the GST.

Corporate bond investment limit oversubscribed, FPIs bid for $2.2 bn

Corporate bonds attracted bids worth Rs 13,900 crore (USD 2.2 billion) from foreign investors as against the debt investment limit of Rs 9,475 crore on offer in an auction on Monday, stock exchange data showed. Till Thursday, the total investment in the corporate debt category reached Rs 2,15,848 crore, which is 96 percent of the total permitted threshold of Rs 2,25,323 crore.

India has best growth prospects among 7 big economies: Report

The country has the best growth prospects among seven large economies of the world, including China and South Korea, a study done by a global logistics major said on Monday. This is due to "strong and sustained increases in both air and ocean freight in and out of the country", DHL and consultancy firm Accenture said.

"More than any of the world’s largest economies, India’s major industries have displayed levels of resilience and growth that will buoy business confidence in the short to medium turn," DHL global forwarding India's managing director George Laswon said.

Apollo Micro Systems closes 65% higher on Day 1 of listing

Shares of Apollo Micro Systems closed 65 percent higher to its issue price of Rs 275. The stock had gained a whopping 74 percent in the opening tick at Rs 478 on the BSE. Aryaman Financial Services was the book running lead manager to the offer.

1.4 mn jobs vulnerable to disruption in US: WEF report

As many as 1.4 million jobs in the United States will be vulnerable to disruption from technology and other factors by 2026, a World Economic Forum (WEF) report said on Monday.

Route Mobile files Rs 600 crore IPO papers with Sebi

Route Mobile Limited on Monday filed draft papers with markets regulator Sebi to raise an estimated Rs 600 crore through an initial share-sale. The initial public offer (IPO) comprises fresh issue of shares worth Rs 350 crore and an offer for sale of up to 65 lakh shares by founders Sandipkumar Gupta and Rajdipkumar Gupta, draft papers filed with Sebi showed.

Motilal Oswal Investment Advisors, Yes Securities and IDBI Capital Markets and Securities will manage the company's IPO.

39 companies scheduled to report results today

As many as 39 companies are scheduled to report their results for the quarter ended December 2017 which include names like Can Fin Homes, United Spirits, RBL Bank, Indiabulls Housing and RBL Bank to name a few.

MORE WILL UPDATE SOON!!

Budget 2018: Top 20 stocks which could see some action on February 1 on Dalal Street

Since it’s the last one, the street expects it to be populist. However, giveaways can only come from either excessive fiscal slippage or higher revenues, most brokerage firms see the possibility of both.

   

Markets are experiencing a strong pre-budget rally which has already pushed benchmark indices to record highs ahead of the big event, Budget 2018 which is also going to be the last full budget of the BJP government.

Since it’s the last one, the street expects it to be populist. However, giveaways can only come from either excessive fiscal slippage or higher revenues, most brokerage firms see the possibility of both.

The fiscal deficit is expected to slip to 3.5 percent in FY18 and 3.3-3.4 percent in FY19; FY18 government capex has stayed on course – we view this as a positive in times of fiscal stress, PhillipCapital said in a report.

While space is limited for any surge in government spending, trend growth pace is expected to persist with focus on roads, metros, housing, irrigation, and defence, it said. The domestic brokerage firm does not see the government going overboard in making this Budget populist, but the rural focus will continue.

Bond yields are discounting higher government borrowings and fiscal slippage, thus incremental rise from current levels is limited. Overall, fewer negatives are expected to come out from this budget.

In FY18, development spending has been weak as oil tailwind faded and tax collections slowed. But, in FY19, brokerage firms expect development spending to revive from 5 percent on a YoY basis in FY18 to 15 percent in FY19 with improving GST compliance 15 percent in FY19 with improving GST compliance.

Commenting on the taxes, Edelweiss said that changes in indirect taxes are unlikely as a) GST Council decides on rates now; b) corporate tax cut unlikely given fiscal pressure; c) some relaxation in income tax slabs/tax rate is expected so as to boost urban disposable incomes.

We have collated a list of 20 stocks across 4 sectors which are likely to remain in limelight around Budget 2018:

Sector Agriculture

Stocks in focus: Dhanuka Agritech, PI Industries and Kaveri Seeds, Chambal Fertilisers and Coromandel International

Brokerage firms are expecting short-term farm loan limit to be increased to Rs 5 lakh from Rs 3 lakh currently which should impact stocks like Dhanuka Agritech, PI Industries, and Kaveri Seeds.

There is another proposal to bring natural gas under GST which would attract 5 percent GST rate. The move would be positive for fertilizer manufacturer Chambal Fertilisers and Coromandel International, Sharekhan said in a report.

Reforms targeting at improving farm income/farm yields such as electronic linkage of mandi's under e-NAM, higher MSPs and the likely increase in rural allocations should auger well for agri-chemical companies like Dhanuka Agritech, Insecticides, and PI Industries.

Brokerage firm expects the amendment to the new investment policy could be made in this Budget. Urea players expect benefits/incentives for investments towards the expansion of urea capacity could impact urea manufacturers like Chambal Fertilisers and Coromandel International.

Sector: Automobile

Stocks in focus: Hero MotoCorp, M&M, Maruti Suzuki India Ltd, Eicher Motors, Tata Motors

Financial incentive may replace vehicles older than 10/15 years. The long-term measures for agri sector to push farmer productivity/ income levels up, and higher JNNURM orders for bus manufacturers and incentives for EVs should also auger well for the sector, Axis Capital said in a report.

Companies which are likely to get positive impact from the proposed changes include names like Hero MotoCorp, M&M, Maruti Suzuki India Ltd.

The incentive for scrapping old heavy commercial vehicles that are more than 10-15 years old should impact companies like Ashok Leyland, Tata Motors, and Eicher Motors.

Sector: Capital Goods, Defence

Stocks: L&T, Kalpataru Power, and KEC International

After 3-4 years of stagnant capex allocation for defence, an increase in defence capital is expected. Edelweiss expects the capital allocation to rise by 8 percent. Companies which manufacture defense-related equipment should benefit positively such as L&T, M&M, BEML, Bharat Electronics, Bharat Forge etc. among others.

Sharekhan expects higher investment in infrastructure development focusing on power transmission and railways which should positively impact stocks like KEC International, Kalpataru, and L&T.

Sector: BFSI

Stocks in focus: SBI, PNB, BOB, PNB Housing, Can Fin Homes, GIC Housing, ICICI Bank, HDFC

Sharekhan expects that Budget would lay out a final blueprint and roadmap of (possible) PSU bank recap plan and steps to improve the bank’s efficiency which should impact PSU stocks like SBI, PNB, as well as Bank of Baroda.

The Modi-government is working towards affordable housing. The steps to promote ‘Housing for All,’ increase in tax exemption for home loans, enhancement of 80C benefits to provide separate brackets. Housing Finance companies such as PNB Housing, Can Fin Homes, GIC Housing are likely to benefit the most.

If the fiscal deficit remains under check it would help in cool-off in bond yields. It will also help in reducing borrowing cost for NBFCs. Banks will avert mark-to-market losses.

To provide parity with life insurance companies Sharekhan expects that if general insurance companies are also exempted from the levy of MAT under section 115JB of Income Tax Act would impact companies like GIC, ICICI Bank, and HDFC Ltd in a positive way.

MORE WILL UPDATE SOON!!

Profit booking likely close to 11,000; 4 stocks which could give up to 10% return

With volatility regime ahead of F&O expiry and earnings season coupled with Budget session due next week, it will be prudent to approach cautiously on long position and maintain a strict stop-loss below 10,600 levels.

  

The Indian equity market continued to post record high levels in its price chart despite turning volatile on a certain session. Although the small and midcap indices remained sluggish during the last week’s trade, Nifty decisively managed to breach its crucial psychological level of 10,900. It failed to sustain and closed marginal below at 10,894 on a closing basis.

On its price chart, the index formed a strong bullish candlestick pattern after breaking above the upper band in trend channel, indicating a positive signal in the upcoming session.

Further, the secondary momentum indicator suggested a strong support with RSI at 72 coupled in MACD at 121 above Signal Line.

Based on Fibonacci Retracement, the index is trading above all the levels with index getting immediate support at 10,650 level and immediate resistance level at 10,906 followed by 10,930 levels.

With volatility regime ahead of F&O expiry and earnings season coupled with Budget session due next week, it will be prudent to approach cautiously on long position and maintain a strict stop-loss below 10,600 levels.

Further, the market may witness a profit booking from a higher level to keep index under pressure and any short-term consolidation to be used as buying opportunity with upside price band at 10,980.

Here is a list of top 4 stocks which could give up to 10% return:

Prakash Industries Ltd: BUY| Target Rs 267 | Stop-loss Rs 230 | Return 10%

Prakash industries witnessed a healthy consolidation at 140 levels during the past month and since then it rebounded back to higher level in its daily price chart and continued to trade on a positive trajectory.

Despite witnessing a marginal consolidation from its 52-weeks high level placed at 276, the scrip recouped higher on the backdrop of volume support.

After closing the last session with 3% gain, the stock has formed a bullish candlestick pattern in its daily price chart coupled with strong support from secondary momentum indicator inclined towards uptrend trajectory.

Currently, the scrip is facing an immediate resistance from its 52-weeks high at 276 levels followed by 193 and major support will be seen at 213 levels. We have a BUY recommendation for Prakash Industries which is currently trading at Rs. 242.30

Balrampur Chini Mills Ltd: SELL | Target Rs 113 | Stop-loss Rs 135 | Return 9%

Balrampur Chini continued to face headwinds in its daily price movement after clocking to 52-weeks high at 182 level in past month and traded on a negative trajectory to close at 122 level, which is just one point above its 52-weeks low.

Further, it witnessed considerable short position on volume which further aided the negative outlook. On the weekly price chart, it continued to form a strong bearish candlestick pattern which is expected to keep the stock under pressure.

Further, the price is currently heading below its crucial level coupled with bearish crossover on its momentum indicator just happening last Thursday.

The stock is facing its resistance at 138 level while the support level at 105 will remain crucial for scrip. We have a SELL recommendation for Balrampur Chini which is currently trading at Rs. 122.70

GRUH Finance Ltd: BUY| Target R s725 | Stop-loss Rs 669 | Return 6%

Despite a flat trading during the initial session, GRUH Finance managed to breakout from upper band price channel and the end the session on positive momentum with over 15 percent gain on an intraday basis.

It also witnessed a similar support from volume context during the same period and end the session on a higher level at 687 on a closing basis.

On the daily price chart, the scrip formed a strong bullish candlestick pattern suggesting a possible uptrend following the last week’s momentum. Further, the RSI at 70 levels indicates a buying action at level coupled with positive MACD at 13.1 still intact above its Signal Line.

With current price trading above all moving average levels, a major support for the scrip is seen at 604 and resistance level at 783 upper band. We have a BUY recommendation for GRUH Finance which is currently trading at Rs. 687.80

Biocon Ltd: BUY| Target Rs. 596 | Stop-loss Rs 552 | Return 5 %

Biocon traded on uptrend trajectory after rebounding back from its lower level at 318 and continued to trade upward in its long-term price chart registering peak.

In the last trading session, the scrip witnessed a crucial breakout from its resistance level which was placed at 566 level, and thus indicated a positive momentum build up in its price chart.

With considerable growth in volume parallel to price movement during last week, the scrip formed a solid bullish candlestick pattern on its weekly price chart.

Further, a secondary momentum indicator continued to trade a positive level coupled with bullish crossover happening soon at the current level.

With price trading above all the levels in the last session, a major support for the scrip is placed at 539 levels and resistance level at 575 followed by 602 level. We have a BUY recommendation for Biocon which is currently trading at Rs. 569.3

MORE WILL UPDATE SOON!!

Buy, Sell, Hold: 11 stocks are in focus on January 22, 2018

Kotak Mahindra Bank, RIL and HDFC Bank, among others, are being tracked by investors on Monday.

  

Brokerage: Nomura | Rating: Neutral | Target: Rs 1,150

Nomura said that miss on margin was netted off by better-than-expected profitability of cap market related. It sees growth picking up and that the bank continued to deliver on extracting cost efficiency. The brokerage expects core RoEs to inch up to 16% by FY20. It prefers HDFC Bank given relatively reasonable valuations.

Brokerage: Macquarie | Rating: Neutral | Target: Rs 1,111

The global research firm observed that the bank had a stable quarter; subsidiaries shine as cons net profit beats estimates. Further, its arms Kotak Sec, Kotak Cap saw net profit growth of 80%/400% YoY. Additionally, standalone net profit was 20% ahead of its estimates. Macquarie likes the bank but its valuations leave limited potential for upside. Going forward, loan growth pick-up, superior subsidiary performance key catalysts for the stock.

Brokerage: Deutsche Bank | Rating: Hold | Target: Raised to Rs 1,100

The global investment bank observed that CASA traction remains strong, investment in digital improving efficiency. Further, a delay in economic recovery is a key downside risk for the stock. Fast, profitable growth after merger key upside risks for the stock.

Jubilant Foodworks

Brokerage: Macquarie | Rating: Outperform | Target: Raised to Rs 2,581

Macquarie said that massive operating leverage the most impressive among otherwise excellent q3 numbers. Even On 2-yr CAGR basis, same-store-sales growth was healthy. Further, it believes that better affordability & product quality will continue to drive SSSG growth. The company was 32-40% ahead of consensus earnings; FY18 EPS is ahead of consensus FY19.

Brokerage: CLSA | Rating: Buy | Target: Raised to Rs 2,800

CLSA said that the multi-quarter high same-store-sales growth & margins, while EPS upgrade cycle continues. Slow expansion for both brands was on expected lines.

HDFC Bank

Brokerage: CLSA | Rating: Buy | Target: Rs 2,340

The brokerage expects 20% CAGR in earnings over FY17-20. Q3 PAT was In-line; encouraged to see 32% yoy growth in operating profit. CASA growth slowed albeit on a high base. Further, a planned capital raise will aid scope for network expansion.

Brokerage: Macquarie | Rating: Outperform | Target: Raised to Rs 2,676

Macquarie said that the firm is a strong compounding story with no asset quality issues. It has raised earnings estimates by 2-4% for Fy18-20.

Brokerage: Nomura | Rating: Buy | Target: Unchanged at Rs 2,350

Nomura expects the firm to delivery best in class PPOP growth over FY17-20. Current valuations of 18x fy20 EPS are not demanding.

Kansai Nerolac

Brokerage: CLSA | Rating: Outperform

CLSA said that impact of higher input prices evident in the company’s Q3, while margin is at multi-quarter low. Further hardening in input prices remains a concern. It also expects the company to offset hardening of input prices with price hikes. CLSA has trimmed forecasts by 2-3 percent.

ITC

Brokerage: Jefferies | Rating: Buy | Target: Raised to Rs 320

The brokerage observed that risk-reward for the stocks is favourable. Further, single-digit tax increase in cigarettes in budget will re-rate the stock.

Brokerage: Macquarie | Rating: Neutral | Target: Rs 304

The brokerage said that cigarettes volume remains under pressure and have cut estimates by 2 percent due to lower realisation. There is limited downside for the stock, have valuation support at current levels.

Brokerage: Deutsche Bank | Rating: Buy | Target: Raised to Rs 350

Deutsche Bank said that cigarette volume decline of 4% qoq was in-line with estimates. A high probability of rational tax increase may a potential re-rating event.

Reliance Industries

Brokerage: Deutsche Bank | Rating: Buy | Target: Rs 1,150

The global investment bank said that strong petchem performance drives EBITDA growth. Further, Jio’s result reflects continued momentum in subscriber additions. It expects EBITDA growth of 41% CAGR over FY17-19.

Brokerage: Credit Suisse | Target: Neutral | Target: Raised to Rs 855

Credit Suisse said that robust EBITDA growth to continue as expansions ramp up. It also raised FY18/19 estimates by 15/9 percent.

Adani Ports

Brokerage: Credit Suisse | Rating: Outperform | Target: Raised to Rs 480

The global research firm said that positive exim sector momentum buoys prospects.

ICICI Pru

Brokerage: Nomura| Rating: Buy | Target: Raised to Rs 540

The brokerage said that it is the preferred life insurance pick. VNB Margin Surprisingly Expands To 13.7% In 9MFY18 From 10.1% In FY17. It expects FY18 margin at 14.7% & long-term expectation at 16-16.5%.

HDFC Life

Brokerage: Nomura | Rating: Buy | Target: Rs 450

Nomura said that it expects steady performance to continue. Further, the firm is a long-term compounder with 20%+ roev. Current valuations should restrict near-term share performance

Wipro

Brokerage: Macquarie | Rating: Neutral | Target: Cut to Rs 290

Client-specific issues may keep co away from industrial level growth for 2-3 quarters. Management is optimistic on macro outlook for CY18.

Brokerage: Credit Suisse | Target: Neutral | Target: Rs 270

Credit Suisse said that Europe & financial performed well while energy has struggled. Client generating revenue of at least $50 m has increased 41 from 33.

HCL Tech

Brokerage: Macquarie | Rating: Outperform | Target: Rs 1,140

Macquarie said that pick up in deal momentum & continued investment in IP partnerships key takeaways. Further, it marginally lower EPS By 1%.

MORE WILL UPDATE SOON!!