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Nifty Outlook

Markets took a breather after the recent surge and lost nearly half a percent. The benchmark opened on a negative note following weak global cues and hovered in a range till the end. Consequently, the Nifty index ended lower by 0.5% at 15,036 levels. Amongst the sectors, profit-taking was witnessed in banking, metal and auto whereas realty, healthcare and power ended with decent gains. Amid all, the market breadth was inclined marginally on the positive side.

We feel it's a healthy pause and expects the prevailing up move to continue. Meanwhile, participants should keep a close eye on the global cues and COVID-related updates. We've started seeing rotational buying across the sectors so the focus should be on sector and stock selection.

News

* Eicher Motors-owned Royal Enfield announced that it will recall 236,966 motorcycles across some models due to defects in the ignition coil that can cause misfiring and reduce the vehicle's performance.

* Heritage Foods announced its Q4FY21 numbers wherein revenue was down 5.1% YoY to Rs. 619 cr. Its consolidated Q4 net profit came in at Rs. 24.2 cr v/s a loss of Rs. 209 cr.

* Indian Oil reported its numbers wherein revenue was up 16.3% YoY to Rs. 1.24 lakh cr. Its net profit grew by 78.6% YoY to Rs. 8,781 cr.

Derivative Ideas

ICICIGI FUTS added around 4% 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 ICICIGI as per below levels.

Strategy:- BUY ICICIGI BETWEEN 1495-1502 STOPLOSS 1470 TARGET 1550.

Investment Pick - Crompton Greaves Consumer Electricals Ltd.

Crompton Greaves Consumer Electricals (CGCE) is engaged in manufacturing and marketing of a wide range of consumer products ranging from fans, light sources and luminaires, pumps and household appliances such as geysers, mixer grinders, toasters and irons.

We like CGCE for its strong growth potential, consistent rise in market share in its key segment coupled with healthy dividend pay-out ratio, strong cash flow generation, lean working capital cycle and robust return ratios. We recommend a Buy on the stock with a target price of Rs. 479.

Buy Crompton Greaves Consumer Electricals Ltd @ 9-12 Months CMP 383.1 TGT 479

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