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Nifty Outlook

Markets ended flat amid volatility, taking a breather after the recent up move. The benchmark opened on a positive note tracking firm global cues. However, weakness in banking stocks capped the upside for the markets. In the latter half, profit booking led the indices to end on a flat note. The broader markets outperformed as both BSE midcap and smallcap ended higher by 0.6% and 0.7% respectively. Amongst the sectors, Realty, Consumer Durables and Auto ended with losses whereas Oil & Gas, IT and Metal ended with gains.

The high growth frequency indicators both domestically and globally would dictate the trend for the markets in the near term. Considering markets are trading at record highs, we would recommend to remain selective.

News

* Adani Ports announced that Andhra Pradesh government approved for 10.4% stake acquisition in Gangavaram Port. The consideration for proposed acquisition of 10.4% equity stake of GPL is Rs. 644.78 cr and the transaction is expected to be completed within 1 month.

* Cipla and Kemwell Biopharma announced execution of a joint venture agreement to develop, manufacture and commercialise biosimilars for global markets. For this purpose, a joint venture company shall be incorporated with an aim to enter the respiratory biosimilars space.

* Kaveri Seed Company board approved the proposal for the buyback worth Rs 120cr at Rs 850 per share. The equity share will have face value of Rs 2 each.

Derivative Ideas 

JUBLFOOD SEPT FUTS added around 12% in open interest in as LONG buildup was seen in it . Current chart pattern also indicates further up move in its price. We suggest buying in JUBLFOOD as per below levels.

Strategy:- BUY JUBLFOOD BETWEEN 3810-3815 SL 3775 TARGET 3890.

Investment Pick - Nippon Life India Asset Management Ltd.

Incorporated in 1995, Nippon Life Asset Management Company (NAM) is one of the leading AMCs in India with a total AUM of ~Rs. 3.79 tn. It is involved in managing the mutual fund (AUM of Rs. 2,442 bn) and managed accounts including Portfolio Management Services (PMS), Alternate Investment Funds (AIF), Pension Funds and Offshore Funds.

We continue to remain constructive on the Indian mutual fund industry given its low penetration level as compared to major economies (11% AUM to GDP ratio v/s world average of 62%). Further, NAM’s consistent increase in equity assets, industry-leading retail assets, focus on growing SIP book and strong presence in B-30 cities augurs well for the growth prospects of the company. We recommend a Buy on the stock with a target price of Rs. 492.

Buy Nippon Life India Asset Management Ltd @ 9-12 Months CMP 402.40 TGT 492

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