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Nifty Outlook

Markets started the week with a sharp cut and lost nearly two percent, tracking weak cues. Initially, the news of the Reliance-Armanco deal cancellation didn’t go well with the participants and sentiment further deteriorated with a continuous decline in the banking heavyweights which cascaded to other sectors as well. Among the benchmark indices, Nifty settled at 17416.55 levels; down by 1.96%.

Participants were already in a cautious mood, citing the feeble global cues like US inflation concern and the rise in the COVID cases and the recent domestic developments have further soured the sentiment. Indications are pointing towards further slide in the Nifty and the next major support is at 17,100 zone. Participants should align their positions accordingly while keeping a check on leveraged positions.

News

Heranba Industries announced that the company has started the commercial production from new Unit-IV situated at Plot No.1409, GIDC, Vapi – 396 195.

Bharat Electronics (BEL) announced that it has bagged an export order from Airbus for C295 Aircraft Programme. Under the contract BEL will manufacture and supply Radar Warning Receiver and Missile Approach Warning System.

 OnMobile Global, the global leader in mobile entertainment, announced that it has launched their new B2B mobile quiz gaming product, Challenges Arena, under the brand name O-Cade with Ooredoo Myanmar.

Derivative Ideas

NIFTY lost around 2% on 22th Nov. The Market is looking weak as it started to trade under its crucial support of 17500.

Strategy:- SELL NIFTY 17800 CE@25-30, SLOSS AT 55, TRGT 5.

Investment Pick - Kansai Nerolac Ltd..

Kansai Nerolac Paints Ltd (KNPL) posted mixed numbers for Q2FY22. Its revenue grew by 17.1% YoY to Rs 1,619.6cr, while its EBITDA and PAT witnessed de-growth of 39% YoY and 48% YoY. Demand from decorative was steady while lower demand from the industrial segment impacted the performance.

KNPL is one of the leaders in the industrial paint segment wherein it garners 40-45% revenue from the industrial segment while remaining from decorative. Going ahead, the company’s strategy is to innovate products in both its segments, expand reach, and focus on product mix as well as gain market share from unorganized segments. Besides, focus to remain on managing cost and operating efficiency which will help in margin growth. Over the medium to long term, we have a positive view on the stock and have maintained a buy with a target price of Rs 705.

Buy - Kansai Nerolac Ltd. @ CMP :- 589.95 Recommendation Price 605 Target 705 Duration 9-12 Months.

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