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Published on 22/10/2020 10:17:28 AM | Source: Religare Broking Ltd

Markets managed to end in the green in a highly volatile session - Religare Broking

Posted in Market Outlook| #Market Outlook #Religare Broking Ltd

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Nifty Outlook

Markets managed to end in the green in a highly volatile session. After the upbeat start, the benchmark remained sideways in the first half however volatile swings in select index majors in the latter half unsettled the participants. The broader market performance was in line with the benchmark and ended flat. On the sector front, Realty, Telecom and Metals were the top gainers whereas FMCG and IT ended with losses.

We expect volatility to remain high, citing mixed global cues and prevailing earnings season. Nifty has been hovering in the range of 11,650-12,050 and needs a decisive break for the further surge. Meanwhile, traders should limit their leveraged positions and maintain positions on both sides.

 

 

News

* PNC Infratech was declared the L1 (lowest) bidder in an EPC Project of upgradation of Canal System from Pothireddypadu Head Regulator and BCR Complex from foreshore of Srisailam Reservoir and lmprovements to existing SRBC/GNSS Canal up to berm level from Banakacherla Complex to Gorukallu Balancing Reservoir with The Water Resources Department.

* Happiest Minds Technologies announced that it has partnered with Lakeside Software to provide Workplace Analytics, Asset Optimization, Artificial Intelligence Operations (AIOps) and Desktop Transformation services.

* DB Corp announced its Q2FY21 results wherein revenue was down 34.8% YoY to Rs. 346 cr as against Rs. 531 cr. Its net profit declined by 63% YoY to Rs. 28.5 cr.

 

Derivative Ideas

TATASTEEL 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 TATASTEEL as per below levels.

Strategy:- BUY TATASTEEL BETWEEN 398-401 STOPLOSS AT 389 TARGET 421.

 

Investment Pick - Bata India Ltd.

* Incorporated in 1931, Bata is the largest retailer and manufacturer of footwear in the country. It has a strong pan-India retail presence with 1,558 stores across cities, including franchisee stores and around ~3.23 mn sq ft retail space. It has production capacity of ~21 mn footwear pairs per annum. Its brands include Bata, Bata Comfit, Footin, Hush Puppies, Marie Claire, Power, Naturalizer, North Star, Patapata, Scholl, Weinbrenner, Disney, Bubblegummers, etc.

* Over the years Bata has been a consistent performer however Q1FY21 was severely impacted due to lockdown led by Covid-19. As the situation is still uncertain we expect FY21 growth to remain muted. Nonetheless we expect the company to regain in FY22E as the situation stabilises and demand would pick-up on the back of better product mix and higher footfalls driven by increasing presence in e-commerce space and tapping new markets, growing distribution network by expanding in semi-rural market and aggressively promoting brands through advertisements. Also company’s efforts towards its loyalty program-‘Bata Club’ will help in revenue generation and adding new clients. Besides, it has healthy balance sheet and strong cash flows which is an added advantage and this would aid to sustain in tough times. Hence we have initiated a Buy on the stock with target price of Rs. 1,669.

Buy Bata India Ltd @ 9-12 Months CMP 1,369.05 TGT 1,669

 

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