Published on 14/10/2020 12:37:46 PM | Source: ICICI Direct

Derivatives Strategy – Positional Future Buy Pidilite For Target Of Rs. 1585 - ICICI Direct

Posted in Broking Firm Views - Short Term Report| #Pidilite Industries Ltd #Chemicals Sector #Trading Report #ICICI Direct

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Positional Future:

* Consumer discretionary and consumption stocks remained in focus and performed well as the lockdown has been lifted in a phased manner

* Paint related stocks saw decent participation last month whereas stocks like Pidilite saw accumulation of long positions for the October series, which has been remained largely in a range

* The recent decline in crude oil prices are likely to provide a sentimental boost to paint related stocks. We feel Pidilite is well placed to capitalise on the opportunity

* Pidilite is facing a hurdle near its sizeable Call base of | 1500. However, at the same time, the stock has not given up its gains and is consolidating at higher levels. We feel a close above | 1500 levels would open the gates for another 8-10% upsides in the stock

* The IV-spread of Pidilite/Nifty remained below but near its mean levels. However, closure in writing positions in Call is likely to pull the IV-spread higher. We feel this would provide more boost to the stock. We feel the stock looks good from a risk: reward prospective and is well placed to move towards | 1600 levels for the month

Positional Future: Buy Pidilite October futures at Rs. 1480-1490, Target: Rs. 1585, Stop loss: Rs. 1425, Time frame: Till October expiry


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