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Nifty Outlook

Markets ended marginally higher in a range bound session, in continuation to the prevailing uptrend. Firm global cues led to a gap up start however profit taking at the higher levels capped upside as the session progressed. Among the sectors, IT pack witnessed noticeable action in early trades which later joined by telecom and realty counters. Importantly, Sensex touched a new milestone of “60000” and Nifty also inched closer to the 18000 mark. Meanwhile, the broader market underperformed wherein midcap ended lower by 0.8% and smallcap index ended flat.

Markets will continue to take cues from global peers in absence of any major domestic event. We expect the positive trend to continue with intermediate pause and expect Nifty to inch towards 18,100. On the downside, 17,820-17,700 would act as a cushion. We reiterate our view to maintain focus on the selection of stocks and continuing with the “buy on dips” approach.

News

* Gayatri Projects has received an amount of Rs 49.74 crore along with future interest at 1O% p.a. till the date of payment in an arbitration award.

* Ramkrishna Forgings has won an export order worth USD 4 million per annum) from North American customer in oil & gas segment.

* Shilpa Medicare via its wholly owned subsidiary, Shilpa Biologicals Pvt Ltd has entered into a definitive agreement with Cadila Healthcare for production-supply of the ZyCov-D vaccine drug substance from its integrated Biologics R&D cum manufacturing center at Dharwad, Karnataka.

Derivative Ideas 

BERGEPAINT FUT has added around 8% in open interest in as fresh long build up was seen in it. Current chart pattern also indicates further up move in its price. We suggest buying in BERGEPAINT as per below levels.

Strategy:- BUY BERGEPAINT BETWEEN 830-835 SL 815 TARGET 865.

Investment Pick - Orient Electric Ltd.

Orient Electric Ltd. (OEL) is part of the diversified USD 2.4 billion Indian conglomerates CK Birla group. OEL is a 60-year-old brand in fans and has established itself as a one-stop brand for lifestyle electrical solutions which include fans, lighting, home appliances and switch gears. Orient Electric has manufacturing facilities in Kolkata, Faridabad and Noida. The company enjoys a marketing presence across 35 countries. In the domestic market, it has a robust sales/ distribution network and service network with pan-India coverage.

After a muted show in FY21 due to the pandemic, we expect OEL’s revenue to grow at 17.5% CAGR over FY21-24E led by a recovery in both ECD and lighting & switchgear segment. On the margins front, higher operational efficiencies coupled with the focus on premiumization would aid margin improvement for OEL. We estimate OEL’s Revenue/EBITDA/PAT to grow at 17.5%/18.6%/24.8% over FY21-24E. We recommend a Buy on the stock with a target price of Rs. 439.

Buy - Orient Electric Ltd @ 9-12 Months CMP 345 TGT 439

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