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Nifty Outlook

Markets traded buoyantly and ended higher for the third consecutive day. Upbeat global cues led to a firm start, which further strengthened with healthy buying in energy, banking, and IT majors. Consequently, Nifty closed around the day’s high to settle at 17,800 levels. However, the broader markets witnessed a mixed day and ended in the range of 0.1-0.2%.

Markets are currently following their global counterparts while the domestic factors are showing mixed indications. Besides, the earnings season is also around the corner and it seems that participants are expecting a positive trend. Apart from the banking majors, the rotational buying in the index heavyweights from the other sectors is helping the index higher. Nifty has the next hurdle at the 18,000 mark while 17,600 would act as a cushion in case of any dip. We would advise aligning positions according to the trend.

News

* The heavy civil infrastructure business of L&T construction has won a prestigious order from Delhi Metro Rail Corporation, for the design and construction of the underground metro project of phase-1 of Patna MRTS.

* Alembic Pharmaceuticals announced that it has received final approval from the USFDA for its Abbreviated New Drug Application for Doxycycline Hyclate Delayed-Release Tablets USP, 75 mg, 100 mg, 150 mg, and 200 mg.

* Mazagon Dock Shipbuilders commissioned four Information Technology based applications for employee benefit, as part of the Government of India’s flagship initiative of Digital India.

Derivative Ideas

IEX gained 1.34% and closed at 261.65 on 4th Jan. We are seeing a good traction in the scrip after testing its support 240 levels. The Scrip looks positive having immediate support at 250 level. IEX is expected to test its previous swing high that lies at 275. We recommend to go Long in IEX.

Strategy:- BUY IEX @ 258-260, SLOSS AT 253, TRGT 275.

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 :-  3,428.4 Recommendation Price 3,335 Target 3,867 Duration 9-12 Months.

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