Month: October 2021

1. Gujarat Pipavav:

The brokerage firm recommends buying the scrip at a price of Rs. 108-112 for a target price of Rs. 128. The horizon for the investment is of 3 months and the stop loss suggested is of Rs. 102 per share.

The Logistic space is witnessing fresh up move after recent breather. The share price of Gujarat Pipavav Port has underperformed within the logistic space and is expect to witness catch up activity. The stock is seen resuming up move after a higher base at the major support around Rs. 100 levels being the confluence of rising 20 weeks EMA (currently atRs. 100 levels) and the rising demand line joining lows since July 2020 signalling strength and offers fresh entry opportunity with a favourable risk reward set up.

The stock has generated a breakout above a falling channel containing last four months breather signalling resumption of up move and opens upside towards Rs. 128 levels in the coming month being the 123.6% external retracement of the recent breather (Rs. 124-98).

Weekly 14 periods RSI has generated a buy signal thus validates positive bias 118 Support at Rs. 102 as it is the value of the rising demand line joining last 15 months lows.

Fundamental View:

Gujarat Pipavav (GPPL) is a South-West Gujarat based port with an MNC promoter (APM Terminals – Maersk Group). It lies at a strategic international maritime location, which connects India with the Far East on the one side and Middle East, Africa, Europe and US on the other. Gujarat Pipavav is expected to be the key beneficiary of operationalisation of the Dedicated Freight Corridor (DFC). GPPL expects a head start in access to Dedicated Freight Corridor (DFC) from ports like JNPT and Hazira which would provide a thrust to its volume growth. Post operationalisation of DFC, incremental Free Cash Flow (FCF) could be further utilised for port capacity expansion. Addition of two service lines is expected to boost Exim volumes. It continues to be a debt free company with return ratios reaching 16%+ levels in FY23E • Driven by expected improvement in business dynamics, we expect revenue CaGR of 13% over FY21-FY23E and 90 bps margin enhancement to 58.5% enabling 380 bps improvement in RoCE to 16.2% in FY23.

2. ITC:

The brokerage on October 12, 2021 recommended to buy the scrip at a price range of Rs. 232-236. Target price given for the stock is Rs. 260 and stop loss suggested is Rs. 260 and stop loss Rs. 215.

There was seen some traction of late in the stock but despite that there’s still seen some steam left in the counter.It is likely to retest its November 2019 highs once again in the coming weeks.

ITC has shown a tendency of moving along in line with the open interest addition. The open interest in the stock has increased sharply in the last couple of sessions suggesting ongoing accumulation in the stock. Despite recent profit booking in the stock, the open interest has remained almost intact, suggesting prevailing long bias still exists. The stock witnessed noteworthy delivery volume activity in September. Hence, current declines in the stock can be utilised as a fresh buying opportunity. The stock made a 52 week high near Rs. 245 in September 2021. Since then, it has been largely range bound hovering around Rs. 230-235. However, recently, the stock has taken support at the lower band level of Rs. 230 and is now witnessing fresh buying momentum. We believe upsides may continue in the stock and it is likely to extend its current move towards Rs. 260 in the coming weeks.

3. Bharat Forge:

The buy in the stock is recommended in the price range of Rs. 760-772, for a target price of Rs. 875. The suggested stop loss is Rs. 699.

Quantitative outlook:

The auto & auto ancillary space has remained largely range bound in the last couple of months with stocks like Bharat Forge underperforming its peers. After remaining range bound for some time, the recent up move is likely to continue towards Rs. 850 and higher levels The open interest in the stock has increased sharply in the last two months. Current OI in the stock is at a two-year high. While the stock has failed to participate in the market move, short positions were formed in it. After this, the stock has given a breakout from its ongoing trading range of Rs. 730-770. We believe short covering movement may be seen, which should take the stock higher in the coming trading sessions. The stock saw significantly high delivery based buying activity in the last month. After a round of consolidation around these levels, we believe it is finally moving into a higher range. Furthermore, delivery volumes were seen in the last week as well. Hence, the stock is likely to continue its upward move amid positive consolidation. The Delivery Z score reading in the cash segment indicates there is still room for further delivery pick-up in coming days. In due course, an up move should pan out in the stock. We expect long term mean+1*sigma levels placed near 700 to act as immediate support for the stock while it should target its 2*sigma levels near 850 in the coming weeks

Disclaimer:

The above stocks are picked from the brokerage report of ICICI Direct. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article

Today, on October 13, gold rates in the international future and spot markets have increased. The trend has been reflected in the Indian markets, and the IBJA has gained the domestic gold rates by Rs. 260/10 grams. Today, 22 carat gold rates are quoted at Rs. 46,290/10 grams and 24 carat gold rates are quoted at Rs. 47,290/10 grams. The Comex gold future hiked by 0.48% and was quoted at $1767, while the spot gold prices hiked by 0.48% and were quoted at $1768/oz till 2.48 PM IST. On the other hand, the US dollar index in the spot market stayed at 94.34 at the same time, fell by 0.20% than yesterday’s position. In India, the Mumbai MCX gold in October future gained by 0.27% today till 2.25 PM IST and was quoted at Rs. 47,326/10 grams. As the US dollar index dropped in the international spot market, gold prices have gained marginally.

The International Monetary Fund (IMF) is worried, global economy’s recovery from the pandemic is being slowed down due to the delta variant Covid. The IMF has also revised its projection and mentioned, the global economy can grow at 5.9% in 2021 and 4.9% in 2022. The global growth anticipation for 2021 was dragged down marginally from 6% by the IMF. Hence this impacted the global gold markets, investors are again focussing on gold as a hedge asset.

Gold rates in different Indian cities are quoted differently, daily. Today’s gold rates in major Indian cities follow:

The IMF has mentioned, “This modest headline revision, however, masks large downgrades for some countries. The outlook for the low-income developing country group has darkened considerably due to worsening pandemic dynamics. The downgrade also reflects more difficult near-term prospects for the advanced economy group, in part due to supply disruptions.” On the other hand, the US’s 2021 growth forecast has been reduced from 7% to 6% due to supply constraints. The IMF can also plunge the US projection further if the country does not pass President Joe Biden’s infrastructure package worth $4 trillion, the IMF warned. Hence, anticipating the US along with the global economy is not in a very promising position, gold prices gained immediately.