Markets consolidate further for yet another day and ended marginally higher. A mixed trend was witnessed on the sectoral front wherein noticeable buying was observed in auto, consumer durables and capital goods space while realty, IT and healthcare traded subdued. Finally, the Nifty index settled at 11,931 levels. However, the broader markets outperformed wherein both Midcap and Smallcap ended higher by 0.5% and 0.7% respectively.
All eyes are on US markets for updates on the stimulus package and upcoming presidential elections. The news on COVID-19 cases in Europe will also remain on the participants' radar. Volatility usually remains high in stocks during the earnings and we’re seeing a similar trend. Amid all, the market is offering ample trading opportunities but the key is to identify the right stock. Since the bias is still positive, we suggest continuing with the “buy on dips” approach.
* Surya Roshni announced that it has bagged orders worth Rs 137 cr for supply of ERW 3LPE Coated Grade line Pipes to ONGC, HPCL & Gujarat Gas for CGD and gas pipe line project.
* Steel Strips Wheels announced that it has received export orders of nearly 94,000 wheels for US & EU trailer market, to be executed in the month of November & December from its Chennai & Dappar plant.
* Asian Granito announced that the board has approved sub division of shares from Rs 10 fully paid up to Rs 2 fully paid up. The board has also approved raising of funds upto Rs 400 cr through either equity issue and/ or Debt instruments.
EXIDEIND added around 7% in open interest addition as long buildup was seen in it in till closing time. Current chart pattern also indicates further up move in its price. We suggest buying EXIDEIND as per below levels.
Strategy:- BUY EXIDEIND BETWEEN 160-161 STOPLOSS AT 157 TARGET 169.
Investment Pick - Britannia Industries Ltd
* Britannia Industries has delivered strong set of numbers for Q2FY21 driven by demand, volumes growth, rollout of wide product range in the market and improvement of distribution and supply chain. Its consolidated revenue grew by 12.1% YoY to Rs 3,419 cr. On operational front, its EBITDA grew by 37.2% YoY to Rs 675 cr, while margin expanded by 361bps on the back on benign raw material cost and cost efficiencies. The company reported 23% YoY growth in net profit at Rs 495.1 cr driven by normalcy in all segments. PAT margin expanded by 127bps YoY to 14.5%.
* Further, for the next 1-2 years company’s plan is to drive growth by expanding product portfolio, focus on growing in international markets, rural area and Hindi belt area which is gaining strong momentum, improving operating efficiencies and managing strong distribution and supply channel. Therefore, we maintain a buy rating on the stock with a target price of Rs 4,265.
Buy Britannia Industries Ltd @ 9-12 Months CMP 3,469.75 TGT 4,265
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