IGI Logo

Nifty Outlook

Markets remained under pressure and lost nearly a percent amid mixed cues. Initially, the benchmark opened flat, tracking favorable global cues but profit taking in the select index majors pushed the benchmark lower as the day progressed. Consequently, the Nifty index closed around the day’s low to settle at 18,266.6 levels. The broader markets also witnessed heightened selling pressure and both midcap and smallcap lost nearly 2% each. Among the sectoral indices, most of the indices, barring banking, closed in negative wherein metal, oil & gas and realty were the top losers.

The tepid start to the earnings season has led to profit taking and global cues have also not been very encouraging. Going ahead, we expect choppiness to continue due to the weekly expiry and the scheduled earnings of some of the index majors so it’s prudent to restrict leveraged positions for the time being and let the markets stabilize.

News

* Jubilant FoodWorks’ announced its numbers wherein revenue was up 36.6% YoY to Rs. 1,101 cr. Its Q2 net profit rose 58%YoY at Rs 121.52 cr versus Rs 76.9 cr.

* NBCC (India) has been awarded the work order for engagement as Independent Engineer for operations, Management and Development of Jaipur International Airport. NBCC is the Project Management Consultant for providing independent engineer services amounting to Rs 12.40 cr inclusive of all taxes except GST.

* Honeywell Automation India has won the bid for the Bengaluru Safe City project under the Nirbhaya Fund announced by the Government of India. The Bengaluru Safe City project is valued at Rs 496.6 cr (USD 67 million).

Derivative Ideas 

NIFTY FUT has shed around 7% in open interest as long unwinding was seen in it. Current chart pattern also indicates further down move might be limited due to put writing at 18200 strike. We suggest buying call options as per below levels.

Strategy:- Buy Nifty 28th Oct 18600 CE@65-70, sloss at 45, trgt 100.

Investment Pick - The Ramco Cements Ltd

Ramco Cements Ltd (TRCL) is the fifth-largest cement producer in India and the most popular cement brand in South India. The company is six decades old and manufactures ready mix concrete, dry mortar products and various grades of cement. It has a presence across ten states of India with four integrated plants and six grinding units. Apart from South India, it is growing its presence in East India, Sri Lanka and the Maldives.

We have a positive outlook given its strong brand name, leadership position in South India and product portfolio. In addition, its focus on expanding capacity, increasing utilization levels and cost-saving initiatives would further help in improving profitability. We estimate its Revenue/EBITDA/PAT to grow at a CAGR of 12%/13.5%/15.5% respectively over FY21-24E and have initiated a Buy on the stock with a target price of Rs 1,237.

Buy - The Ramco Cements Ltd @ 9-12 Months CMP 985.7 TGT 1,237

To Read Complete Report & Disclaimer Click Here

Please refer disclaimer at https://www.religareonline.com/disclaimer

SEBI Registration number is INZ000174330

Views express by all participants are for information & academic purpose only. Kindly read disclaimer before referring below views. Click Here For Disclaime