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Nifty Outlook

Markets inched higher for the third successive session and gained over 1.5%, tracking favourable cues. Positive global sentiment and easing crude oil prices led to the gap-up opening in the benchmark. As the day progressed, sentiments boosted as the state elections outcome so far indicated a clear majority to the BJP in 4 states out of 5, showing political stability. Among the sectors, healthy buying in sectors such as Realty, PSU banks and FMCG supported the rally. Consequently, the Nifty ended with strong gains of 1.6%. The broader markets too ended in the positive range of 1-1.4%. All the sectoral indices ended in the green.

Markets have witnessed a decent rebound however sustainability would depend on how the geopolitical situation pans out and its impact on crude. Meanwhile, we thus suggest continuing with a cautious stance and preferring hedged positions. Among the sectors, metal and select FMCG and IT majors look firm while the rest are showing a mixed trend

News

L&T has secured 'significant' orders for its construction and infrastructure businesses. The Railways SBU has secured an EPC order of IRCON International. Meanwhile, the company's Factories business secured an order from an FMCG manufacturer for a food processing facility in Gujarat. Besides, it also secured an order to expand a specialty hospital in Kolkata with 250 beds and the built-up area of the project is 2.61 Lakh sq. ft.

Jindal Steel and Power posted sales numbers for February, with steel volumes up 8% YoY to 5.90 lakh tonnes. Its steel production stood at 6.57 lakh tonnes, up by 1% YoY while exports contributed 24% to the sales volumes.

Kalpataru Power Transmission announced that it has received a Letter of Intent for a Power Transmission and Distribution project in the international market. The project will involve design, engineering, supply and construction of a HVDC power transmission line of ~700 kms. The estimated value of the project stands at Rs 3,276cr (USD 431Mn).

Derivative Ideas

DABUR gained 3.33% and closed at 545.7 on 10th Mar. The stock after taking the support at the channel line shown a good up move. Now trading above its resistance zone at 525-530, the counter is poised to test its resistance at 570 levels. We recommend to go Long in DABUR.

Strategy:- BUY DABUR @ 535-540, SLOSS AT 520, TRGT 570.

Religare New Year Pick - INOX Leisure Ltd.

Incorporated in 1999 and part of the INOX Group, INOX Leisure Ltd. (INOX) is the second-largest multiplex chain operator in India. The company’s screen additions have grown multi-fold over the past 10 years, from 91 screens in FY09 to 667 screens currently (Q3FY22 end) having a wide presence in ~70 cities with a seating capacity of 1,50,000+.

We like INOX in this space given its focus on enhancing the consumer experience, continued emphasis on expansion, effort on increasing spending per head, and increasing footfalls. We recommend a Buy on the stock and arrive at a target price of Rs. 495 (target EV/EBITDA multiple of 13x). Some of the key risks to our estimates include a) resurgence in COVID cases and b) slower than expected revival in footfalls.

Buy INOX Leisure Ltd @ 9-12 Months CMP 412.5 TGT 495

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