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Nifty Outlook

Markets took a breather after the recent surge and settled with a cut of nearly half a percent. The benchmark started on a positive note despite mixed global cues however it could not hold gains at higher levels as investors chose to book profits as the day progressed. Consequently, the Nifty closed lower by 0.3% at 17076 levels. The sectoral indices witnessed a mixed trend wherein IT and metals were the top losers while realty posted strong gains of nearly 5% followed by PSU bank and media. The broader market also continued its positive momentum and ended higher in the range of 0.3-0.8%.

Markets may see some consolidation ahead and it would be healthy. We reiterate our view to focus on the banking index for further directional move in Nifty. On the downside, the Nifty may find support around the 16,900 zone. Considering the trend, traders should continue with the “buy on dips” approach.

News

* M&M overall auto sales for the month of August 2021 stood at 30,585 vehicles wherein the company sold 15,786 and 15,973 vehicles in the Utility Vehicles and passenger segments. Exports for the month were at 3,180 vehicles.

* Maruti Suzuki India posted total sales of 130,699 units in August 2021. The company sold 1,05,775 units in the domestic market, sales to other OEMs was 4,305 units and exports was 20,619 units.

* Ashok Leyland's August 2021 total sales were up 48% at 9,360 units versus 6,325 units, YoY.

Derivative Ideas 

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

Strategy:- BUY MCDOWELL-N BETWEEN 727-730 SL 715 TARGET 760.

Investment Pick - Nippon Life India Asset Management Ltd.

Incorporated in 1995, Nippon Life Asset Management Company (NAM) is one of the leading AMCs in India with a total AUM of ~Rs. 3.79 tn. It is involved in managing the mutual fund (AUM of Rs. 2,442 bn) and managed accounts including Portfolio Management Services (PMS), Alternate Investment Funds (AIF), Pension Funds and Offshore Funds.

We continue to remain constructive on the Indian mutual fund industry given its low penetration level as compared to major economies (11% AUM to GDP ratio v/s world average of 62%). Further, NAM’s consistent increase in equity assets, industry-leading retail assets, focus on growing SIP book and strong presence in B-30 cities augurs well for the growth prospects of the company. We recommend a Buy on the stock with a target price of Rs. 492.

Buy Nippon Life India Asset Management Ltd @ 9-12 Months CMP 406.7 TGT 492

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