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Nifty Outlook

Markets traded under pressure and shed over a percent, tracking mixed global sentiment. After the flat start, the benchmark hovered in a range in the first half however profit taking in index majors gradually pushed the index lower. In the news update, the resurgence of COVID cases in China largely impacted sentiment. Consequently, the Nifty closed at 16,663; down by 1.2%. The decline was broad-based as all sectors, barring auto, ended lower.

Global cues are largely dictating the market trend and we expect this trend to continue. The US Fed meet, updates regarding Russia-Ukraine peace talks and rising COVID cases in China would remain on the participants’ radar. In short, we expect volatility to remain high so traders should maintain extra caution now and prefer hedged positions.

News

* L&T announced that it has bagged significant orders in India and abroad for its Power Transmission & Distribution Business.

* Granules India announced that Granules Pharmaceuticals, Inc., a wholly-owned foreign subsidiary of the company has received an Establishment Inspection Report from the USFDA. Its facility was inspected from 24th-28th January 2022 for two of its product applications filed. There were three minor observations during the inspection and the company had addressed the observations in the stipulated time period.

* Blue Star unveiled its range of affordable yet-best-in-class differentiated split ACs, for this summer season. Overall, the Company has launched nearly 50 models across the spectrum of inverter, fixed speed, and Window ACs

Derivative Ideas

TVSMOTOR gained 0.43% and closed at 594.8 on 15th Mar. The Auto sector is seeing a decent rebound and TVSMOTOR is trading in sync with its pack. The stock has given positive closing for 3 consecutive sessions. Trading above 586, the counter is poised to test its resistance at 610 levels. We recommend to go Long in TVSMOTOR.

Strategy:- BUY TVSMOTOR @ 586-590, SLOSS AT 578, TRGT 610.

Religare New Year Pick - INOX Leisure Ltd.

Incorporated in 1999 and part of the INOX Group, INOX Leisure Ltd. (INOX) is the second-largest multiplex chain operator in India. The company’s screen additions have grown multi-fold over the past 10 years, from 91 screens in FY09 to 667 screens currently (Q3FY22 end) having a wide presence in ~70 cities with a seating capacity of 1,50,000+. We like INOX in this space given its focus on enhancing the consumer experience, continued emphasis on expansion, effort on increasing spending per head, and increasing footfalls. We recommend a Buy on the stock and arrive at a target price of Rs. 495 (target EV/EBITDA multiple of 13x). Some of the key risks to our estimates include a) resurgence in COVID cases and b) slower than expected revival in footfalls.

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