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Nifty Outlook

Markets rebounded sharply after yesterday’s sell-off and managed to gain nearly 3%. After the initial uptick, the benchmark inched lower in the first hour but the news that some of the Russian troops are being pulled out from the Ukraine border lifted sentiment as the day progressed. The rally was largely driven by healthy buying in sectors such as auto, IT and banking stocks. Consequently, the Nifty index settled around the day’s high to close at 17,352 levels. The broader markets too ended in a positive range of 2.6-2.9%

Markets have been witnessing a roller-coaster ride and we expect the same to continue in near future. In absence of any major domestic event, updates related to Russia-Ukraine tension and its impact on global markets will be on the radar. We suggest limiting leveraged positions and waiting for the markets to stabilise.

News

* SpiceJet Q3FY22 consolidated revenue stood at Rs 2,263cr, up by 33.8% YoY. Its net profit came in at Rs 42.5cr versus a loss of Rs 66.7cr YoY.

* IFCI consolidated net sales stood at Rs 274cr, down 55% YoY. Net loss for Q3FY22 stood at Rs. 706.4cr as against Rs. 727 cr YoY.

* D. B. Corp announces 20% increase in ad rates on MY FM across all its key markets with effect from February 15, 2022.

Derivative Ideas

VOLTAS gained 2.04% and closed at 1194.1 on 15th Feb. The stock has taken the support at 1140-1155 zone which acted as its support quite a few times earlier as well. After that the counter surged 4%. Holding 1150, VOLTAS is poised to test its resistance at 1250 levels. We recommend to go Long in VOLTAS.

Strategy:- BUY VOLTAS @ 1176-1182, SLOSS AT 1150, TRGT 1240.

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.

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