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Nifty Outlook

Markets traded lackluster and ended marginally in the red, tracking mixed cues. The beginning was downbeat following negative global cues however the index managed to recoup its losses and traded in a narrow range thereafter. Finally, Nifty ended lower by 0.2% at 15,824 levels. The broader markets too ended flat. Amongst the sectors, a mixed trend was witnessed wherein Consumer Durables, IT and Metal ended with gains while Auto, Capital Goods and Oil & Gas ended with losses.

Going forward, the earnings announcement from select Nifty majors combined with global cues will dictate the trend. Meanwhile, we reiterate our view to limit leveraged positions and wait for further clarity.

News

* Kotak Mahindra Bank reported its Q1FY22 numbers wherein the net interest income grew 5.8% YoY to Rs 3,942 cr as against Rs 3,723.8cr. The net profit for the current fiscal rose to 31.9% at Rs. 1,641.92cr. against Rs. 1,244.4cr. YoY.

* Alembic Pharmaceuticals reported its numbers wherein revenue came down 1.1% at Rs 1,326cr as against Rs 1341cr. YoY. Net profit also came down by 45.3% YoY to Rs 161.9cr as against Rs 295.7cr.

* SBI Life Insurance posted a 42.9% YoY drop in Q1FY22, where the net profit is at Rs 223.16cr. The Value of New Business (VNB) increased by 45% YoY to Rs 340cr in Q1FY22. Also the company’s New Business Premium (NBP) grew by 9% YoY to Rs 3,350cr in Q1FY22.

Derivative Ideas

COROMANDEL FUTS added around 14% 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 COROMANDEL in cash as per below levels.

Strategy:- BUY COROMANDEL BETWEEN 908-910 STOPLOSS 895 TARGET 940.

Investment Pick - CSB Bank Ltd.

Established in 1920, CSB Bank Ltd (known as The Catholic Syrian Bank) is one of the oldest private sector banks in India. It has a significant network in Kerala, Tamilnadu, Karnataka and Maharashtra. At present, 90% of the branches are in these four states and the remaining 10% is spread across other states in India. The bank operates mainly in four business areas namely SME banking, retail banking, wholesale banking and treasury operations.

We believe CSB bank is well placed as it has a strong gold loan book, prudent management team and steady financials with improved asset quality. Further, a well-planned strategy like betting on less risky businesses such as agriculture, food & service, etc. and avoiding risky unsecured loans augurs well for future growth. From a long term perspective, we are optimistic on the company’s growth prospects thus initiating a Buy on the stock with a target price of Rs 432.

Buy - CSB Bank Ltd @ 9-12 Months CMP 352.2 TGT 432.

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