SAMVAT 2077 PICKS

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SAMVAT 2077 PICKS

15000 ABOVE 12800; 10700 IS MAJOR SUPPORT

After making a top of 12430 in January 2020, Nifty saw steep correction of 40% by touching a low of 7511 in March.

From there, the benchmark staged a spectacular rebound and has even surpassed the erstwhile top of 12430.

Next level to watch out on the way up is 12800, around which, a rising trendine adjoining tops made in August 2018 and June 2019, presents resistance.

Once this hurdle is taken out decisively, next meaningful resistance will come only around 15000, where a rising trendlineadjoining tops made in November 2010 and March 2015, would present resistance.

On the way down, 34-month moving average is placed around 11080 and 10700 is where 200-day simple moving average is placed. This makes 11080-10700 an important support zone, with the stop-loss of which long positions can be added/held on to.

1.

SAMVAT 2077 PICKS

STOCK PICKS FOR SAMVAT 2077

TECHNICAL STOCK PICKS

SCRIP NAME

AU BANK

RECO.PRICE (₹)

TARGETPRICE (₹)

809 1035

MRF 69841 81000

ULTRATECH CEMENT 4625 5625

TVS MOTORS 479 610

SUGGESTEDSTOP LOSS (₹)

POTENTIALUPSIDE (%)

617 28

61000 16

3824 22

385 27

2.

SAMVAT 2077 PICKS

FUNDAMENTAL STOCK PICKS

SCRIP NAME

ITC

RECO.PRICE (₹)

173

INDIAN ENERGY EXCHANGE 197

BHARTI AIRTEL 472

PSP PROJECTS 391

POTENTIALUPSIDE (%)

250 45

280 42

600 27

510 30

AXIS BANK 565

WIPRO 352

CADILA HEALTHCARE 438

BAJAJ AUTO 3002

700 24

439 25

541 24

3455 15

TARGETPRICE (₹)

3.

SAMVAT 2077 PICKS

4.

AU BANK

AU BANK, after hitting a low of 366 in May this year, rebounded to touch a high of 817 in July.

Since then, the stock has been consolidating in a range of 200 points.

After this consolidation, the stock is ready for abreakout as it hit a high of 828 on Monday.

+Di is firmly placed above –Di and ADX has started moving northward, which suggests a strong upside momentum.

The stock can be accumulated between 809-750 for the target of 1035. The stop-loss should be placed at 617 on weekly closing basis.

TECHNICAL STOCK PICKS

SAMVAT 2077 PICKS

5.

MRF

After correcting from 81425 to 49915, MRF has rebounded and is currently trading at 69841.

This week, the stock is breaking out from a trendline resistance adjoining tops made in August 2018 and February 2020.

The stock has closed above it’s upper band of Bollinger on weekly chart, suggesting strength and positive momentum.

The stock can be accumulated between 69841-65000 for the target of 81000. The stop-loss should be placed at 61000 on weekly closing basis.

SAMVAT 2077 PICKS

6.

ULTRATECH corrected from 4905 top made in May 2019 to 2910 in March this year.

The stock has rebounded since then and is currently trading at 4625.

This week, the stock is confirming a breakout from a downward sloping trendline adjoining tops made in May 2019 and February 2020.

The stock can be accumulated between 4625-4300 for the target of 5625. The stop-loss should be placed at 3824 on weekly closing basis.

ULTRATECH CEMENT

SAMVAT 2077 PICKS

7.

TVS MOTORS has seen a steep correction from 794 in January 2018 to 240 in April 2020.

Since then the stock has recovered and is currently trading at 479.

The stock is trading above it’s 20-month moving aver-age for past couple of months and is negotiating 34-month moving average where it was resisted last month at 490.

The stock should be accumulated between 480-440 for the target of 610. The stop-loss should be placed at 385 on weekly closing basis.

A crossover of 490 will also mark a breakout from trendline resistance adjoining recent tops on the monthly chart.

TVS MOTORS

SAMVAT 2077 PICKS

8.

FUNDAMENTAL STOCK PICKS

The play on ITC revolves around its FMCG division turning profitable, gradual recovery in cigarette volumes & it’s cheap valuation. In the preceding ten years, the stock price has gone up by just 46%.Whereas, during the same period, its earnings per share has gone up by 242%. This implies that the stock is undervalued.

ITC

Company commands a 98.5% market share in power exchange market of India. Average Return onCapital Employed (RoCE) over the last five years stands at 48%. Average PAT Margin over the last five years stands at 60%. The company works on a negative working capital cycle and resultantly has zero debt on its balance sheet.

INDIAN ENERGY EXCHANGE

SAMVAT 2077 PICKS

9.

The data usage per customer was 1 GB for Airtel in September 2016. This has now increased to almost 15 GB in March 2020- a phenomenal rise of 1400%. People are hooked to their mobiles either watching videos on youtube, web series on apps such as Hotstar, Netflix, Voot or surfing apps such as Facebook, Instagram, Twitter etc. With massive consolidation in telecom players, Bharti Airtel will emerge to be a winner in the longer run.

BHARTI AIRTEL

PSP Projects is a construction company pre-dominantly engaged in the geography of Gujarat &Maharashtra. It has build marquee projects such as some parts of Sabarmati Riverfront, India’s largestdiamond bourse in Surat, Gujarat Vidhansabha, some parts of IIM Ahmedabad, Zydus Hospital etc. It is known for its strong execution capabilities & this helps it to maintain a lean balance sheet with minimal debt on its books.

PSP PROJECTS

SAMVAT 2077 PICKS

10.

The play is on strategies to shift to low default rate granular retail loan book. Retail loan book now account for 53% of the overall loan book. Further, Axis carries one of the highest additional provisions on the balance sheet implying that worst is accounted for in the profit & loss account and bank is expected to report good results in the coming quarters. Further, stock is attractive from a valuation angle.

AXIS BANK

The IT major is available at attractive valuations. In the preceding ten years, the stock price has gone higher by 117%, whereas it’s earnings per share has grown by 140%. This suggests that the stock has not moved higher in tandem with its earnings potential. Further, with new leader at the helm the focus on growth has returned and with the digitization drive which is sweeping across sectors, Wipro is set tobenefit from the trend.

WIPRO

SAMVAT 2077 PICKS

11.

Cadila Healthcare is one pharmaceutical company which has diversified well. Apart from retaining its core focus on pharmaceuticals, it boosted its consumer care through its subsidiary Zydus Wellness and animal health segments. Cadila's largest market is the US, which contributes to more than 42% ofrevenues. In the US, the company is well diversified with a presence in areas such as transdermal(patches), injectables, nasal sprays, and tough-to-manufacture oral solids.

CADILA HEALTHCARE

Bajaj Auto is well diversified geography wise with 40% of the revenues coming from exports. Itcommands a market leader position thrashing Chinese competition in two-wheeler motorcycle markets of certain African countries. With a 19% market share in domestic two-wheeler motorcycle industry, Bajaj is well placed with its brands such as Pulsar & CT 100. It also commands a market leadership position in three-wheeler passenger vehicle market in India.

BAJAJ AUTO

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