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Nifty Outlook

Markets extended rebound and gained over a percent amid excessive volatility. The benchmark started the day on a strong note, tracking firm global cues however profit-taking in the index majors, mainly from the banking pack, capped the upside as the session progressed. However, renewed buying in select heavyweights in the last hour helped the index to close around the day’s high.

Consequently, Nifty settled above 14,900 levels; up by 1.1%. The broader market indices, midcap and smallcap, continued their outperformance and ended with strong gains of 1.6% each.

On the sector front, all the indices ended in positive with IT and Auto leading the pack. Markets are mirroring global indices and we expect this trend to continue. Nifty is likely to fill the open gap but the performance of the banking index would be critical. We feel it’s prudent to continue with a stock-specific trading approach in the present market scenario while keeping a check on leveraged positions.

News

* Cipla announced that its subsidiary, Cipla Gulf is expanding its partnership with Alvotech for the marketing and distribution of four bio similar medicines in Australia and New Zealand.

* Bharti Airtel said that it has acquired 355.45 MHz spectrum across Sub GHz, mid band and 2300 MHz bands for a total consideration of Rs 18,699cr in the latest spectrum auction conducted by the Department of Telecom, Government of India. This gives Airtel the most formidable spectrum holdings in the country.

* Adani Ports and Special Economic Zone announced that in the month of February 2021 it has handled cargo volume of 21.12 MMT, a growth of 8% YoY. This includes cargo volume of 2.95 MMT handled at Krishnapatnam Port.

Derivative Ideas

WIPRO FUTS added around 5% in open interest addition as LONG buildup was seen in it till closing time. Current chart pattern also indicates further up move in its price. We suggest buying WIPRO as per below levels.

Strategy:- BUY WIPRO BETWEEN 425-427 STOPLOSS AT 415 TARGET 454.

Investment Pick - Mahindra & Mahindra Ltd.

Established in 1945, Mahindra and Mahindra (M&M) is the flagship company of the Mahindra Group. It is one of the leading conglomerates which operate in various segments such as Automotive (PVs, CVs, 2W and 3W), Farm Equipment, Hospitality, Information Technology, Financial Services, Real Estate, Retail and Logistics. M&M is the market leader in Tractors and Utility Vehicles (UV) segment which is a part of its core business (Farm equipment and Auto).

Factoring the strong performance in Q3FY21, we have raised our estimates for M&M and expect revenue and PAT to grow at 12.9% and 22.5% CAGR over FY20-23E. We value the core business at 16x FY23E EPS of Rs. 51.5 and arrive at a SOTP based target price of Rs. 1,087.

Buy Mahindra & Mahindra Ltd @ 9-12 Months CMP 860.05 TGT 1,087 

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