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Nifty Outlook

Markets traded volatile in a range and ended almost unchanged, taking a breather after the recent up move. After the gap up opening, the benchmark witnessed profit taking at the higher levels and slipped gradually lower the session progressed. Bulls attempted to reclaim momentum in the middle but the pressure in the IT, FMCG and pharma pack derailed their plans. Consequently, the Nifty ended at 17,855 levels. The broader markets also traded in tandem and closed flat. On the sector front, auto and realty were the top gainers.

We reiterate our bullish view on markets with intermediate pause and suggest continuing with the “buy on dips” approach. Traders should maintain their focus on the selection of trades and overnight risk management.

News

*  InterGlobe Technology Quotient, a leading travel technology provider announces its agreement with EaseMyTrip, to provide seamless access to ITQ’s travel commerce platform – Travelport (1G). The agreement is worth USD 10mn as advance revenue from ITQ.

* Cyient announced that it is recognized by Amazon Web Services as a Select-Tier Consulting Partner in the AWS Partner Network (APN). The APN is the global community of Partners who leverage AWS to build solutions and services for customers.

* Manali Petrochemical and Econic Technologies have entered into a Memorandum of Understanding for introducing a more environment friendly, CO2 containing polyols, into the USD 28Bn global polyols market.

Derivative Ideas 

BHARATFORGE FUT has added around 15% in open interest in as fresh long build up was seen in it. Current chart pattern also indicates further up move in its price. We suggest buying in BHARATFORGE 780 CE as per below levels.

Strategy:- BUY BHARATFORGE 780 CE@9-10 SLOSS AT 4 TRGT 19.

Investment Pick - Orient Electric Ltd.

Orient Electric Ltd. (OEL) is part of the diversified USD 2.4 billion Indian conglomerates CK Birla group. OEL is a 60-year-old brand in fans and has established itself as a one-stop brand for lifestyle electrical solutions which include fans, lighting, home appliances and switch gears. Orient Electric has manufacturing facilities in Kolkata, Faridabad and Noida. The company enjoys a marketing presence across 35 countries. In the domestic market, it has a robust sales/ distribution network and service network with pan-India coverage.

After a muted show in FY21 due to the pandemic, we expect OEL’s revenue to grow at 17.5% CAGR over FY21-24E led by a recovery in both ECD and lighting & switchgear segment. On the margins front, higher operational efficiencies coupled with the focus on premiumization would aid margin improvement for OEL. We estimate OEL’s Revenue/EBITDA/PAT to grow at 17.5%/18.6%/24.8% over FY21-24E. We recommend a Buy on the stock with a target price of Rs. 439.

Buy - Orient Electric Ltd @ 9-12 Months CMP 339.55 TGT 439

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