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Nifty Outlook

Markets took a breather after four days of the successive rise and shed nearly a percent citing feeble global cues. Initially, weak global cues were weighing on the sentiment as global markets reacted to the FOMC meeting minutes which indicated a sooner than expected rate hike. Besides, news of further restrictions imposed by several states, due to a sharp uptick in the COVID cases, also dampened the mood. However, recovery in select index majors helped the index to pare some losses. Consequently, the Nifty ended lower by 1%. On the flip side, the broader market indices, midcap and small-cap, outperformed and ended on a flat note.

Markets may witness further consolidation however the bias would remain on the positive side till Nifty holds a 17,400 zone. Apart from the global cues and COVID news, the earnings -related updates would keep the volatility high. Traders should continue with a positive yet cautious approach and focus more on sectors/stocks selection.

News

* D.J Mcdiaprint & Logistics Ltd has secured orders from ICICI Bank for Printing & Dispatch Services.

* Alembic Pharmaceuticals has received final approval from USFDA for its Abbreviated New Drug Application, Entacapone Tablets USP, 200 mg.

* ADF Foods has received approval from the Government of India under the Production Linked Incentive Scheme-Category III-Incentive for branding and marketing expenditure abroad.

Derivative Ideas

MGL gained 0.14% and closed flat at 878.9 on 6th Jan. The Scrip is looking to have completed its downward journey where it took trendline support at 840 levels. The Scrip has started moving higher and is now expected to test its Resistance at 920 level. We recommend to go Long in MGL.

Strategy:- BUY MGL @ 870-874, SLOSS AT 857, TRGT 900.

Investment Pick - Metropolis HealthcareLtd.

Incorporated in 1980, Metropolis Healthcare is one of the leading diagnostic players in India. Metropolis has spread its footprint across 19 states & 210 cities. It has a dominant share in the western and southern regions. It offers a comprehensive range of 4,000+ clinical laboratory tests. It also offers analytical and supports services to clinical research organisations for their clinical research projects.

The diagnostic industry is expected to register strong growth driven by multiple growth drivers. Within this space, we like Metropolis given its pan India presence, asset-light business model, strong brand equity, and wide range of tests. Further, a strong focus on increasing its B2C business and specialized testing would aid margin improvement. We thus raise our estimate for Metropolis and expect Revenue/ EBITDA/PAT to grow at 19.0%/18.9%/20.9% over FY21-24E. We recommend a Buy rating on the stock with a target price of Rs. 3,867.

Buy - Metropolis Healthcare Ltd. @ CMP :-  3,335.8 Recommendation Price 3,335 Target 3,867 Duration 9-12 Months.

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