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Nifty Outlook

Markets traded upbeat for yet another session and gained over half a percent, in continuation to prevailing up move. The beginning was on a flat note, tracking muted global cues however noticeable buying in the banking, metal and auto majors helped the benchmark inch gradually higher as the session progressed. Consequently, the Nifty ended with strong gains of 0.7% to close at 17,925.25 levels. Meanwhile, the broader indices traded mixed and both ended on a flat note.

Markets have witnessed an excellent start of the calendar year however we may see a breather now as Nifty may find resistance around the 18,000-18,100 zone. Currently, the banking and finance majors are leading from the front so their performance would hold importance to surpass that zone ahead. Besides, the scheduled weekly expiry would add to the volatility. Amid all, traders should opt for trailing stop losses for their existing positions and stay put. However, one should wait for some consolidation or a dip for fresh buying in the index.

News

* Nelco announced that they have won a contract for a turnkey project from ONGC worth more than Rs 40cr.

* IndusInd Bank posted its Q3FY22 business update wherein net advances rose 3% QoQ at Rs 2,28,128cr as against Rs 2,20,808cr. The deposits were up 3% QoQ at Rs 2,84,835cr as against Rs 2,75,473cr.

* ABB announced the launch of a new range of low voltage flameproof motors which are designed for safe use in applications in potentially explosive atmospheres.

Derivative Ideas

BPCL gained 2.27% and closed at 394.7 on 5th Jan. We are seeing a noticeable buying in the Oil & Gas Sector and our pick from this sector is BPCL. The Scrip gave a trendline breakout at 380 levels and is poised to test its Resistance at 410-415 zone. We recommend to go Long in BPCL.

Strategy:- BUY BPCL @ 389-391, SLOSS AT 384, TRGT 405.

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 :-  3,414.8 Recommendation Price 3,335 Target 3,867 Duration 9-12 Months.

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