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Nifty Outlook

Markets witnessed profit taking after the recent surge and ended with a cut of over a percent. Mixed global sentiments led to a flat start however profit booking across sectors particularly IT, finance and realty dragged the benchmark lower as the day progressed. Consequently, the Nifty ended around the day’s low to close at 17,560 levels. The broader indices also lost in the range of 0.1-0.7%

Markets have been experiencing volatile swings despite the positive bias and we expect this trend to continue citing choppy global markets and prevailing earnings season. On the index front, Nifty should hold 17,350 for further recovery else the profit taking may extend. Meanwhile, participants should maintain their focus more on risk management and add quality stocks on dips.

News

* Titan Q3FY22 revenue stood at Rs 9,515cr, up by 30.6% YoY driven by strong growth across all the businesses. Its net profit was up 135.6% YoY to Rs 987cr.

* GAIL India Q3FY22 revenue rose 19.8% QoQ to Rs 25,769.8cr. Its net profit grew 14.8% QoQ at Rs 3,288cr.

* Radico Khaitan Q3FY22 revenue was up 12% YoY at Rs 766.1cr. Its net profit slipped 5.9% YoY to Rs 79.1cr.

Derivative Ideas

TITAN gained 0.44% and closed at 2474.95 on 3rd Feb. The stock has shown a good upmove after respecting 2200-2250 zone where it took support multiple times. Trading above its important 21EMA, TITAN is poised to test 2520-2550 levels. We recommend to go Long in TITAN.

Strategy:- BUY TITAN @ 2455-2465, SLOSS AT 2425, TRGT 2520.

Religare New Year Pick -  Sudarshan Chemical Industries Ltd.

Sudarshan Chemical Industries (SCI) is one of the leading producers in India and has been serving for over 70 years in Indian and global pigment markets. It manufactures an extensive range of organic, inorganic, effect pigment and dispersions. It has two manufacturing facilities located at Roha and Mahad in Maharashtra, India and 2 dedicated R&D centre globally. In addition, it exports to 85+countries and has 10 sales offices in India, US, Europe, China, Mexico, and Japan.

We believe SCI is well placed to capitalize opportunities in the global as well as Indian pigment sector driven by positive industry growth trend, high entry barrier in the sector and wide range of products in their portfolio. Besides, they’re highly cost competitive amongst the peer group. On the financial front, the company’s track record has been decent and we have estimated its revenue and PAT to grow at a CAGR of 14.5% and 14% over FY22-24E. We have a positive view on the company and have initiated a Buy on the stock with a target price of Rs 720.

Buy - Sudarshan Chemical Industries Ltd. @ CMP :-  586.8 Recommendation Price 576 Target 720 Duration 9-12 Months.

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