religare morning digest - · pdf filethe bank may merge some of its loss making branches ......
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Religare Morning Digest
February 22, 2017
Nifty Outlook
VWAP (Expiry till date) Max OI (Call) Max OI (Put)
NIFTY 8725 9000 8800
Nifty managed to settle marginally higher in a volatile session today. The first half was dull but rebound in select banking majors in latter half fuelled the momentum. Amid all, participants were busy in rollover and unwinding their derivatives positions.
Almost all the sectoral indices have participated in this rally so far and now rotational buying is playing its part. As long as this continues, uptrend will endure. We advise to stay with the trend and avoid taking contrarian trades.
Sectors to watch
Sector Name Outlook
BANK STABLE
ENERGY STABLE
METAL STABLE
News
Religare Super Ideas**
FII & DII Cash Segment (Rs. in Cr.) Trade Stats
Category Amt. MTD YTD
FII -433 8970 22635
DII 828 -1606 32217
NO OF CON-
TRACTS
TURNOVER IN CR
IDXFUTS 393256 27865
IDXOPT 4938233 358852
STKFUTS 1303417 89943
Derivative Ideas **
Bank of Maharashtra gained close to 14% on news of cost saving strategy. The bank may merge some of its loss making branches and cut zonal offices in the next fiscal. This will boost its operating profit by cutting operating expenditure and ease capital. Currently there are around 1,940 branches and close to 300 are in losses.
US FDA inspection at Aurobindo Pharma’s unit-11 in Srikulam, Andhra Pradesh was successfully completed with zero observations. The Unit-11 plant produces non-antibiotic active ingredients, is used for both the captive purpose of Aurobindo’s formulation manufacturing and for supplies to external customers. The US formulation business contributes 45 percent of Aurobindo’s total revenue.
Siemens announced partnership with Siemens Rail Automation S.A.U. Spain for a Nagpur Metro order worth Rs. 287 Cr. For the first two metro lines of Nagpur Metro i.e. the North-South and the East-West Corridors, the companies are going to supply state-of-the-art signaling technology.
*FII & DII data as on 20th February 2017
Scrip Buy/Sell CMP Initiation
Range SL* Target
M&MFIN BUY 299.90 298-300 285 325
SIEMENS BUY 1221.90 1225-
1230 1180 1320
**Please note that the given technical and derivative recommendations are
"valid for taking position" only on recommended date and in the given range.
*Please note - Stoploss is on closing basis for delivery recommendation and intraday basis for futures recommendation.
Instrument B/S Lot INITIATION
RANGE SL
TAR-GET
AXISBANK BUY FEB
500 CE 1200 6-7 2 18
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Religare Morning Digest
February 22, 2017
Religare Super Ideas
Investment Pick - SML Isuzu
SML Isuzu reported in-line Q3FY17 numbers, wherein Net sales increased by 18.3% to Rs. 228.1 Cr and Net profit stood at Rs. 3.1 Cr compared to Net loss of Rs.
0.9 Cr in Q3FY16. The total volume for the quarter stood at 2,623 units, up 12% on YoY basis.
With investment on technology up gradation, capacity expansion and new launches, we expect the growth momentum to continue. Also, higher capacity
utilization will lead to operational leverage benefit in the coming years. We maintain a Buy on the stock for a target of Rs. 1,560.
Scrip CMP Target Duration Recommendation Price
SMLISUZU 1,228.20 1,560 9-12 Months 1,240
AXISBANK added around 32% of open interest as
fresh long positions. It has rolled around 41% into
next contact. Call buying (unwinding buy writers)
was seen at 490 & 500 strikes, put writing was seen
at 490 & 500 strikes. It has also witnessed upside
breakout from congestion zone of last four months
and so with noticeable rise on daily charts. We
recommend buying AXISBANK 500 CE as per levels
given below.
Strategy: BUY AXISBANK FEB 500 CE BETWEEN 6-7,
SL 2, TARGET 18.
Derivative Ideas
Mahindra & Mahindra Financial Services Lim-
ited (M&MFIN)
Siemens Limited( SIEMENS)
M&MFIN has registered breakout from a distorted
inverted Head & Shoulder Pattern on daily chart
and likely to witness fresh surge ahead. Traders are
advised to accumulate in the given range.
After consolidating around its long term averages
on the daily chart, Siemens now look all set for an
up move. The confirmation oscillators are also in
agreement to the chart pattern. Traders can utilize
this phase to accumulate this stock.
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Religare Morning Digest
February 22, 2017
Religare Investment Calls
Name of the Company Reco Date Reco Price Target Price Upside % Previous day Closing Price
Tech Mahindra 7-Aug-15 534 600 12.4% 507.9
Kotak Mahindra Bank 19-Aug-15 688 900 30.8% 797.9
Glenmark Pharma 10-Sep-15 1,017 1,370 34.7% 950.0
Dabur India 10-Sep-15 275 325 18.1% 273.0
HUL 10-Sep-15 803 1,050 30.8% 854.5
Bajaj Corp 3-Nov-15 416 500 20.3% 375.3
Britannia Inds 23-Dec-15 2,896 3,600 24.3% 3239.1
Nandan Denim 5-Jan-16 150 183 22.0% 118.2
Atul Auto 22-Mar-16 506 580 14.6% 418.1
Jamna Auto 2-Sep-16 217 272 25.3% 203.5
Cigniti Technologies Ltd. 5-Oct-16 419 538 28.3% 389.1
Arman Financial Services 14-Oct-16 260 338 30.0% 226.1
Garware Wall Ropes Ltd. 23-Nov-16 567 686 21.0% 658.8
VIP Industries Ltd. 30-Nov-16 118 166 41.0% 150.1
Minda Corporation 06-Dec-16 95 117 23.2% 93.8
Fiem Industries 26-Dec-16 1,089 1,315 20.8% 987.1
Castrol India 26-Dec-16 358 483 34.9% 433.1
LIC Housing Finance 25-Jan-17 526 667 27.0% 557.1
Force Motors 25-Jan-17 4,274 5,210 21.9% 4277.4
Zee Entertainment Enterprises 27-Jan-17 498 592 18.8% 523.3
Swaraj Engines Ltd. 31-Jan-17 1,406 1,736 23.5% 1379.1
Greenply Industries 3-Feb-17 268 304 13.4% 296.1
Manpasand Beverages 7-Feb-17 681 854 25.4% 702.4
Wonderla Holidays 7-Feb-17 380 430 13.1% 374.2
Century Plyboards 8-Feb-17 216 300 38.8% 229.5
Credit Analysis and Research 9-Feb-17 1,381 1,694 23.0% 1396.3
NRB Bearings 9-Feb-17 108 132 22.2% 109.8
Tv Today Network 14-Feb-17 270 360 33.3% 264.5
CRISIL 14-Feb-17 2,078 2,540 22.2% 2055.5
Sutlej Textiles 14-Feb-17 843 1,032 22.5% 849.9
Jain Irrigation Systems 17-Feb-17 93 104 11.8% 96.0
Indo Count Industries Ltd. 17-Feb-17 164 207 26.2% 165.3
Talwalkars Better Value Fitness 20-Feb-17 217 328 51.1% 215.0
SML Isuzu 21-Feb-17 1,240 1,560 25.8% 1228.2
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Religare Morning Digest
February 22, 2017
Result Calendar — February 2017
Sun Mon Tue Wed Thu Fri Sat
19 20
AMBUJA CEMENTS LTD.
HINDUSTAN EVEREST TOOLS LTD.
KSB PUMPS LTD.
Varun Beverages Ltd
21
CASTROL INDIA LTD.
E.I.D.-PARRY (INDIA) LTD.
ELANTAS BECK INDIA LTD.-$
HIND ALUMINIUM INDUSTRIES LTD.-$
ITD CEMENTATION INDIA LTD.
KAMAT HOTELS (INDIA) LTD.
NET 4 INDIA LTD.
NUWAY ORGANIC NATURALS INDIA LTD.
OVOBEL FOODS LTD.
Huhtamaki PPL Limited
RCL Foods Limited
22
NIVYAH INFRASTRUCTURE & TELECOM SERVICES LTD.
23
Mahindra CIE Automotive Lim-ited
Rain Industries Ltd
SAVITA OIL TECHNOLOGIES LTD.
STOVEC INDUSTRIES LTD.
TANTIA CONSTRUCTIONS LTD.
24 25
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Religare Morning Digest
February 22, 2017
Corporate Action Calendar — February 2017 (Cash Dividend) Sun Mon Tue Wed Thu Fri Sat
19 20
Solar Industries India Ltd
AIA Engineering Ltd
Dhampur Sugar Mills Ltd
Fineotex Chemical Ltd
21 22
Greaves Cotton Ltd
Centum Electronics Ltd
Control Print Ltd
Hinduja Global Solutions Ltd
Sudarshan Chemical Industries
Hi-Tech Gears Ltd/The
Vidhi Dyestuffs Manufacturing Ltd
Indo Count Industries Ltd
Nicco Parks & Resorts Ltd
Poddar Pigments Ltd
NRB Bearings Ltd
Veto Switchgears and Cables Ltd
DCM Shriram Ltd
NCL Industries Ltd
MEP Infrastructure Developers Ltd
SJVN Ltd
Container Corp Of India Ltd
VIP Industries Ltd
Eldeco Housing & Industries Ltd
23
CESC Ltd
Natco Pharma Ltd
24 25
Corporate Action Calendar — February 2017 (Acquisition)
Date Target Company Acquirer Company
2/21/2017 Jaykay Enterprises Ltd JK Traders Ltd
2/23/2017 Sai Moh Auto Links Ltd Private Investor
2/23/2017 Soma Textiles & Industries Ltd KGPL Industries & Finvest Pvt Ltd
2/23/2017 Heptagon Technologies Pvt Ltd Quess Corp Ltd
Economic Calendar — February 2017
Sun Mon Tue Wed Thu Fri Sat
19 20 21 22 23 24
Eight Infrastructure Industries
25
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Religare Morning Digest
February 22, 2017
Current Portfolio and Performance Summary as on 21st February’17
Stock Sector Entry Date Weight Reco price (`) CMP (`)
Bajaj Corp Consumer Goods May 13, 2016 8.7% 393 375
Magma Fincorp Financial Services June 30, 2016 8.5% 109 99
Apollo Hospitals
Enterprises Healthcare Services July 29, 2016 9.5% 1,362 1,284
Emami Consumer Goods August 3, 2016 9.6% 1,151 1,106
Castrol India Energy August 5, 2016 10.2% 425 433
Punjab National Bank Financial Services October 3, 2016 10.3% 143 144
Minda Corporation Auto Ancillaries October 10, 2016 9.1% 109 94
CRISIL Financial Services February 2, 2017 10.2% 2,000 2,056
Sml Isuzu Auto February 6, 2017 9.7% 1,265 1,228
Cash 14.2%
Total Total 100%
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Religare Morning Digest
February 22, 2017
Historical Performance as on 21st February’17
Performance Matrix 1-Month 3-Month 6-Month 1-Year Since Inception
Religare Alpha 5.7% 7.3% -0.2% 23.2% 27.4%
Nifty 6.7% 12.3% 3.0% 23.1% 13.0%
Outperformance -1.0% -5.1% -3.2% 0.1% 14.4%
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Religare Morning Digest
February 22, 2017
Research Product Basket
For cash market trading
Call / Product Call Frequency No. of calls Avg open call duration % funds allocated
Intraday Calls Intraday 2 - 3 < 1 day 25%
Live / RMD Calls Daily 3 - 4 3 - 4 days 30%
Master Pick Weekly 1 1 month 15%
Religare Alpha Opportunity NA 2 - 3 months 20%
Cash NA 10%
For 1L margin*
Total Per Call
25,000 8,000
30,000 4,000
15,000 5,000
20,000 As per weightage
10,000
Intraday Calls These calls are flashed live on Ms Lync and ODIN with the purpose of squaring off positions on the same day. As a policy, we restrict our
intraday cash market calls to less than 4 calls a day. Hence, funds should be allocated accordingly to have provision to trade in all calls.
Live / RMD Calls 2 super ideas are flashed in RMD daily with a view of 3-4 days. Additionally as per market opportunity, we flash live calls during the day
(including BTST calls). 3-4 such calls are made on a daily basis which might be open for 3-4 days. Funds should be allocated keeping in mind that
there will be 7-8 such open calls daily.
Master Pick This is our weekly recommendation shortlisted on the basis of techno-funda analysis. 15% of funds is recommended to be allocated for Master
Pick considering that there will be 3 open calls. The average open duration for this call will be 1 month.
Religare Alpha This is a portfolio of 8-10 stocks which are held with a view of 2-3 months. It is recommended to allocate 20% of funds for building this portfolio
which will provide stability to the overall trading portfolio.
Cash 10% surplus cash in the portfolio should be kept for the purposes of allocating it to opportunities as and when they arrive.
For derivative market trading
Call / Product Call Frequency No. of calls Avg open call duration % funds allocated
Derivative Ideas Daily 1 - 2 1 - 3 days 40%
Live calls Intraday / Daily 1 - 2 3 - 4 days 50%
Cash NA 10%
For 1L margin*
Total Per Call
40,000 40,000
50,000 50,000
10,000
Derivative Ideas 1 derivative idea is shared in RMD daily. It can be a plain vanilla F&O buy/sell call or an option strategy. Funds should be allocated assuming 2
such calls will be open at any time. These calls are open for 3-4 days on an average.
Live Calls These calls are flashed on MS Lync and ODIN during live market hours. These calls can be intraday or with a view of 2-3 days. Funds should be
allocated considering 2 such calls will be open at any time. 3/4 times, these calls will be on Nifty / Bank Nifty only.
Cash It is recommended to hold 10% cash to capitalize on any opportunity that may arise in markets.
For every client, the advisor must allocate a specific proportion of funds for trading and investing depending on the risk taking ability and willingness of the client
and their investment goals.
The below mentioned product basket tries to address the way to deal with the trading portfolio (cash/derivative) for optimum effectiveness of research calls.
It is recommended to divide your trading funds for various types of calls and not invest the entire amount for 1 or 2 calls only.
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Religare Morning Digest
February 22, 2017
Hitesh Agrawal [email protected]
Ajay Pasari, CFA [email protected]
Ajit Mishra [email protected]
Archana Gude [email protected]
Gaurav Sharma [email protected]
Swati Saxena [email protected]
Manoj M Vayalar [email protected]
Mehernosh Khurshed Panthaki [email protected]
Siji A Philip [email protected]
Vipin Kumar [email protected]
Team Members
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Religare Morning Digest
February 22, 2017
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Statements on ownership and material conflicts of interest , compensation– Research Analyst (RA)
[Please note that only in case of multiple RAs, if in the event answers differ inter-se between the RAs, then RA specific answer with respect to questions under F (a) to F(j) below , are given separately]
Nature of Interest ( if answer to F (a) above is Yes : ……………………………………………………………………………………………………………………
Name(s) with Signature(s) of RA(s).
[Please note that only in case of multiple RAs and if the answers differ inter-se between the RAs, then RA specific answer with respect to questions under F (a) to F(j) above , are given below]
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S. No. Statement Answer
Yes No
I/we or any of my/our relative has any financial interest in the subject company? [If answer is yes, nature of Interest is given below this table] No
I/we or any of my/our relatives, have actual/beneficial ownership of one per cent. or more securities of the subject company, at the end of the month immediately preceding the date of publication of the research report or date of the public appearance?
No
I/we or any of my/our relative, has any other material conflict of interest at the time of publication of the research report or at the time of public appearance?
No
I/we have received any compensation from the subject company in the past twelve months? No
I/we have managed or co-managed public offering of securities for the subject company in the past twelve months? No
I/we have received any compensation for brokerage services from the subject company in the past twelve months? No
I/we have received any compensation for products or services other than brokerage services from the subject company in the past twelve months? No
I/we have received any compensation or other benefits from the subject company or third party in connection with the research report? No
I/we have served as an officer, director or employee of the subject company? No
I/we have been engaged in market making activity for the subject company? No
SS..No. Name(s) of RA.
Signtures of RA
Serial Question of question which the signing RA needs to make a separate declaration / answer
Yes No.