religare morning digest · religare morning digest june 16, 2017 nifty outlook ... version of...
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Religare Morning Digest
June 16, 2017
Nifty Outlook
VWAP (Expiry till date) Max OI (Call) Max OI (Put)
NIFTY 9555 9700 9500
Markets traded under pressure and lost nearly half a percent, mainly pressurised by weak global cues. It opened lower and maintained negative tone till the end. The news of rate hike by the US Fed was already discounted and markets reacted primarily to the news of special counsel will investigate the US president for his role in obstruction of justice. Mostly sectoral indices traded in line with the benchmark and ended lower while the market breadth remained flat.
Nifty has almost tested its crucial support of 9550 today and rebounded marginally in the end. With no major event around, we feel global cues and further update on monsoon will dictate the market trend ahead. We suggest continuing with stock specific trading approach and focus mainly on index majors and select few from the midcap and smallcap pack.
Sectors to watch
Sector Name Outlook
AUTO STABLE
FMCG STABLE
IT WEAK
News
Religare Super Ideas**
FII & DII Cash Segment (Rs. in Cr.) Trade Stats
Category Amt. MTD FYTD
FII -161 -304 -7386
DII 72 1287 14810
NO OF CON-
TRACTS
TURNOVER IN CR
IDXFUTS 148359 11998
IDXOPT 8464055 760136
STKFUTS 587687 41464
Derivative Ideas **
Aurobindo Pharma has received final approval from the United States Food & Drug Administration (USFDA) to manufacture Sevelamer Carbonate oral suspension, 0.8 gm and 2.4 gm. The Sevelamer Carbonate oral suspension is a therapeutic equivalent generic version of Genzyme’s Renvela oral suspension. The product is being launched immediately.
Aarti Industries has entered into a multi-year contract with a global agriculture company to supply high value agrochemical intermediary. Aarti will supply high value agrochemical intermediary for use in herbicides over a period of 10 years. The supplies are expected to commence from FY20 and would generate revenues of approximately Rs 4,000 crores over the contract term.
Ratnamani Metals & Tubes has bagged two new orders aggregating to Rs. 328 cr for supply of HSAW pipes of Rs. 116 cr and supply of ERW pipes of Rs. 212 cr for Oil and Gas Pipe lines to be completed by Jan 2018.
*FII & DII data as on 14th June 2017
Scrip Buy/Sell CMP Initiation
Range SL* Target
FEDERALBNK BUY 119 116-118 114 126
RELCAPITAL SELL FUTS 599.95 605-610 620 580
**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
INITIA-TION
RANGE
SL TAR-GET
NIFTY
9700CE SELL 75 38-40 52 18
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Religare Morning Digest
June 16, 2017
Religare Super Ideas
Investment Pick - Talwalkars Better Value Fitness Ltd
Talwalkars Better Value Fitness Ltd (TBVFL) reported inline numbers for Q4FY17 with a revenue and PAT growth of 17% & 23.6% YoY. Led by cost efficiencies,
EBITDA margins expanded 274bps YoY to 70.7%, which was encouraging.
With steady gym additions, healthy same store sales growth and higher contribution from value added services, we expect revenue and profit growth to remain
healthy. We maintain a BUY with target price of Rs 328.
Scrip CMP Target Duration Recommendation Price
TALWALKARS 304.90 328 9-12 Months 277
NIFTY has been hovering in the range of
9500-9650 for almost 8-10 sessions. Huge call
writing is seen at 9600 and 9700 strike. Nifty
9700 strike CE has the highest open interest as
well. We expect Nifty to be in 9500-9650 range in
short term.
Strategy: SELLNIFTY JUNE 9700 CE@38-40 SLOSS
AT 52,TARGET 18.
Derivative Ideas
The Federal Bank Limited (FEDERALBNK) Reliance Capital Limited (RELCAPITAL)
FEDERALBNK has bounced sharply from its support
zone and currently trading on the verge of
breakout from a consolidation pattern around its
record high. We suggest traders to initiate fresh
long in the given range.
After a sharp correction from its 52-week high,
RELCAPITAL has now rebounded of late and
reached closer to resistance zone around 600.
Keeping in mind its overall trend, we advise to use
this bounce to create fresh short positions.
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Religare Morning Digest
June 16, 2017
Religare Investment Calls
Name of the Company Reco Date Reco Price Target Price Upside % Previous day Closing Price
Nandan Denim 5-Jan-16 150 183 22.0% 127.8
Atul Auto 22-Mar-16 506 580 14.6% 418.3
Cigniti Technologies Ltd. 5-Oct-16 419 538 28.3% 262.5
Fiem Industries 26-Dec-16 1,089 1,315 20.8% 952.5
Greenply Industries 3-Feb-17 268 304 13.4% 284.1
Arman Financial Services 22-Feb-17 226 340 50.0% 180.7
Castrol India 7-Mar-17 412 483 17.1% 409.5
Berger Paints (I) Ltd 15-Mar-17 230 273 18.7% 253.2
Mayur Uniquoters Ltd 18-Apr-17 380 478 25.8% 361.8
CRISIL 26-Apr-17 1,911 2,540 32.9% 1,867.4
Zee Entertainment Enterprises 12-May-17 530 592 11.6% 508.4
Force Motors 17-May-17 4,497 5,210 15.9% 4,227.1
Indo Count Industries Ltd. 17-May-17 198 240 21.2% 180.5
Huhtamaki PPL Ltd 19-May-17 253 266 5.3% 246.2
Bajaj Finance Ltd 22-May-17 1,268 1,454 14.7% 1,405.3
SML Isuzu 25-May-17 1,247 1,525 22.3% 1,198.7
Sutlej Textiles 29-May-17 902 1,032 14.5% 894.1
Jain Irrigation Systems Ltd. 30-May-17 97 125 28.8% 107.1
Srikalahasthi Pipes Ltd 30-May-17 320 416 29.7% 352.5
Wonderla Holidays 31-May-17 378 430 13.7% 367.6
Tv Today Network 2-June-17 263 335 27.3% 259.4
The Byke Hospitality 6-June-17 190 242 27.4% 189.2
Mold-Tek Packaging Limited 7-June-17 274 340 24.1% 284.8
Magma Fincorp Ltd 9-June-17 135 163 20.5% 149.5
Talwalkars Better Value Fitness 12-June-17 277 328 18.3% 304.9
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Religare Morning Digest
June 16, 2017
Corporate Action Calendar — June 2017 (Stock Buyback)
Sun Mon Tue Wed Thu Fri Sat
11 12
HCL Technologies Ltd
Marathon Nextgen Realty
13 14 15 16 17
Corporate Action Calendar — June 2017 (Cash Dividend)
Sun Mon Tue Wed Thu Fri Sat
11 12
JSW Steel Ltd
13
Tata Consultancy Services Ltd
Kansai Nerolac Paints Ltd
Chembond Chemicals Ltd
14
Mastek Ltd
Can Fin Homes Ltd
Visaka Industries Ltd
15
Deepak Nitrite Ltd
ASM Technologies Ltd
Vijaya Bank
Nitta Gelatin India Ltd
Asian Paints Ltd
Cheviot Co Ltd
16
Navin Fluorine International Ltd
Tata Communications Ltd
Union Bank of India
Dena Bank
Syndicate Bank
Allahabad Bank
17
Corporate Action Calendar — June 2017 (Stock Dividend)
Sun Mon Tue Wed Thu Fri Sat
11 12
Muthoot Capital Services Ltd
13
Wipro Ltd
14 15
Biocon Ltd
16
Thacker & Co Ltd
17
Economic Calendar — June 2017 )
Sun Mon Tue Wed Thu Fri Sat
11 12
CPI YoY
Industrial Production YoY
BoP Current Account Balance
13
Manpower Survey
14
Wholesale Prices YoY
Trade Balance
Exports YoY
Imports YoY
15 16 17
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Religare Morning Digest
June 16, 2017
Current Portfolio and Performance Summary as on 15th June’17
Stock Sector Entry Date Weight Reco price (`) CMP (`)
Emami Consumer Goods August 3, 2016 9.2% 1,151 1,136
Castrol India Energy August 5, 2016 9.0% 425 410
Sml Isuzu Auto February 6, 2017 8.9% 1,265 1,199
Amara Raja Batteries Auto March 22, 2017 10.6% 868 838
Power Grid Corporation of India
Energy April 12, 2017 11.5% 200 210
Bajaj Finance Financial Services May 5, 2017 11.2% 1,292 1,405
TV Today Network Media & Ent. May 10, 2017 9.5% 279 259
Tata Motors Auto May 26, 2017 9.3% 475 448
Capital First Financial Services May 26, 2017 10.1% 705 722
Cash 10.6%
Total 100%
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Religare Morning Digest
June 16, 2017
Historical Performance as on 15th June’17
Performance Matrix 1-Month 3-Month 6-Month 1-Year Since Inception
Religare Alpha -2.8% 9.0% 14.7% 14.3% 36.3%
Nifty 1.4% 5.4% 17.7% 16.7% 21.5%
Outperformance -4.2% 3.6% -3.0% -2.5% 14.8%
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Religare Morning Digest
June 16, 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
June 16, 2017
Hitesh Agrawal [email protected]
Ajay Pasari, CFA [email protected]
Ajit Mishra [email protected]
Archana Gude [email protected]
Manoj M Vayalar [email protected]
Mehernosh Khurshed Panthaki [email protected]
Siji A Philip [email protected]
Suhanee Shome [email protected]
Vipin Kumar [email protected]
Team Members
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Religare Morning Digest
June 16, 2017
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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.