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Nifty Outlook

Markets retested the record high and settled marginally in the green as participants preferred to book some profit off the table. Extending yesterday’s gains, the benchmark opened the gap up tracking favorable global cues and the news of vaccination drive gaining momentum. However, profit-taking in the index majors trimmed the gains as the day progressed and Nifty finally settled at 15,773 levels. A mixed trend was witnessed on the sector front wherein finance, FMCG and realty were the laggards while auto, IT and metals posted modest gains.

Though the index has not made any meaningful progress in this month so far, the bias is still positive. It’s difficult to make any sustainable move without banking, which is still trading sluggish. We may see further choppiness ahead due to scheduled derivatives expiry and mixed global cues. Meanwhile, traders should continue to use intermediate dips to buy quality names while keeping a check on leveraged trades.

News

* Avanti Feeds reported Q4FY21 numbers, its revenue was up 6.1% YoY at Rs 1,098cr. Its consolidated net profit was down 20% YoY at Rs 69.7cr.

* Cyient Ltd announced that it has launched CyientifIQ, an innovation platform to identify, build, and deploy intellectual property (IP)-driven solutions, products, and platforms.

* Engineers India announced that it has received a project for execution of Revamp of Delayed Coker Unit from Numaligarh Refinery. It shall execute this project as Licensor cum Engineering, Procurement & Construction Management Consultant.

Derivative Ideas

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

Strategy:- BUY IRCTC BETWEEN 2060-2070 STOPLOSS 2020 TARGET 2150.

Investment Pick - Finolex Industries Ltd.

Finolex Industries Limited (FIL) is a leading manufacturer of PVC pipes and fittings and the only backward integrated player in PVC resin. The company offers the latest range of PVC-U pipes and fittings which are used in agriculture, construction and industrial operations. It has strategically located manufacturing plants and a strong distribution network.

FIL is well established in agri pipes and has plans to expand in non-agri segment, its backward integrated manufacturing of PVC resin, strong distribution network and changing product mix would aid in earning better revenues as well as profits. Besides its strong brand recall value, growth plans and expansion in the PVC pipes segment are encouraging which makes it one of our preferred picks in this space. On the financial front, FIL has a healthy balance, decent cash flow and it has lowered its debt to comfortable levels over the years. We have initiated a BUY on the stock with a target price of Rs 222.

Buy Finolex Industries Ltd. @ 9-12 Months CMP 172.75 TGT 222

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