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Nifty Outlook

Markets ended almost on a flat note for the second successive session, taking a breather after the recent surge. Initially, the benchmark opened with an uptick following upbeat global cues however profit-taking in the index majors, especially from the banking space, trimmed all the gains. On the flip side, sectors such as FMCG, consumer durables and IT capped the fall and aided the index to close unchanged.

In absence of any major event, global cues will continue to dictate the market trend in near future. Besides, any news of unlocking by the state governments will also be closely watched as we’re seeing a sustained decline in new COVID cases. We feel the choppiness may continue especially in the F&O stocks ahead of the upcoming monthly expiry of May month contracts. Traders should align their positions accordingly and continue with the “buy on dips” approach.

News

* Alkem Laboratories posted Q4FY21 revenue at Rs 2,192.2cr, up by 75% YoY. Its net profit was up by 27.2% at Rs 240cr.

* TVS Srichakra’s Q4 revenue was up 39.5% at Rs 602cr and its net profit rose 44.6% YoY at Rs 35 cr.

* Indoco Remedies revenue was up 12.2% at Rs 295.1cr. Its net profit stood at Rs 25cr versus Rs 5.4cr YoY.

Derivative Ideas

GAIL FUTS added around 14% in open interest as LONG buildup was seen in it. Current chart pattern also indicates further up move in its price. We suggest buying in GAIL as per below levels.

Strategy:- BUY GAIL BETWEEN 153-154 STOPLOSS 149 TARGET 162.

Investment Pick - Maruti Suzuki India Ltd

Maruti Suzuki India Ltd. (MSIL) is India’s largest passenger vehicles (PV) company with a commanding market share of ~48% in the domestic market with ~1.2 million vehicles sold in FY21. It is a subsidiary of Suzuki Motor Corporation, Japan. MSIL has two manufacturing plants located at Gurugram and Manesar in Haryana with an installed capacity of ~1.58 million vehicles per year. Further, MSIL boasts of its wide distribution network with ~2,765 channels (including NEXA) and has 3,864 service workshops covering 1,914 cities. Further, MSIL is the largest exporter of passenger cars from India.

we expect margins could remain under pressure in the near term due to rising commodity prices and lower volumes. However, price hikes, better product mix and cost rationalization measures would aid margin improvement in FY22 and FY23. We recommend a Buy on the stock with a target price of Rs. 8,289.

Buy Maruti Suzuki India Ltd @ 9-12 Months CMP 6911.8 TGT 8,289

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