Market Mantra February 05, 2019

Indian Market % Change Trading Strategy

Last Close 1 day YTD
Bata India (Buy between Rs1183-1189, Target
Sensex 36,583 0.3 8.2
Rs1207, Stop Loss Rs1174.75): The stock has
Nifty 10,912 0.2 4.6
been under pressure for the past three weeks
Nifty Bank 27,187 0.4 7.4
and has finally broken out from a falling channel
Nifty Midcap 50 4,681 (0.8) (15.4) pattern on the weekly chart. The price outburst
Nifty Smallcap 50 6,044 (1.5) (34.2) has been accompanied with smart uptick in
traded volumes. The stock has also held above
Developed
Markets
% Change its 50-DEMA convincingly. Hold long positions
Last Close 1 day YTD
with mentioned Stop Loss on closing basis.
Dow Jones 25,239 0.7 1.7 Derivative Strategy (Time period: Till expiry)
Nasdaq 7,348 1.2 4.9 Buy Bank Baroda February future at Rs110.5-
S&P 500 2,725 0.7 1.1 111, Stop Loss Rs108.75 and Target Rs113-
Hang Seng 27,990 0.2 (8.3)
113.25.
Nikkei 20,884 0.5 (11.2)
Nifty Outlook: Nifty finds support around 10873,
Institutional Activity (`cr)
while 11000 will act as resistance on the upside.
Cash YTD
Bank Nifty finds support around 27000, while
FII (112) 702
DII (65) 6,413
27450 will act as resistance.
*Provisional Figures
Asian indices opened with gains led by the
Advance/Decline stocks No. (NSE)
Australian market with the S&P index clocking
04-Feb-19 01-Feb-19
Adv 483 816
best month returns in over 10 years. Banks,
Dec 1298 958 metals & consumption stocks lead the rally as
Unch 308 99 ETF flows see emerging markets become choice
destination for 2019. Chinese New year will see
some markets closed for holidays which may
see low volumes in the other markets.
 Derivative
FutChg Current OI OI in PCR PCR ATM Max CE Max PE %
Index Spot Future Basis OI Chg
(%) v/s Total OI (%) Shares OI VOL IV Buildup Buildup Rollovers
Nifty 10912 10938 0.2 25 64.9 198.8 1.8 1.67 0.99 14.0 11000 10700 8.1
BankNifty 27187 27274 0.5 87 33.0 14.7 1.6 1.04 0.85 14.7 27500 27500 1.9

OI Gainers Derivative Snippets

OI OI Chg Price
Underline Price Action
(lakhs) (%) Chg (%)
(21.1 Short
 Nifty Futures and Bank Nifty Futures added
CONCOR 23 40.8 520 fresh long positions.
) Buildup
RPOWER 542 22.7 17
(35.2 Short  On the options front put writing was
) Buildup witnessed in out-of-the-money put options
Short
MARICO 63 16.2 365 (2.8)
Buildup strikes with 10800PE witnessing an addition
of ~5.35 lakh shares.
OI Losers  India Vix ended 0.02% higher at 15.72%.
OI OI Chg Price
Underline
(lakhs) (%)
Price
Chg (%)
Action  The PCR for Nifty currently stands at 1.67 vs.
Long 1.63.
BERGEPAINT 52 (14.6) 310 (5.2) Unwindin
g  FIIs were net sellers in the cash market
Long segment to the tune of `112cr.
NMDC 215 (11.0) 96 (0.1) Unwindin
g
Long FII Long-Short Activity
RAMCOCEM 6 (6.8) 602 (0.4) Unwindin Long-
% % Chg Long-Short
g Index OI Short
Chg Since Exp Ratio since Exp
Ratio
Nifty Active Strikes Fut Long 131 1 21
0.8 1.2
Price Chng % OI % OI Change Fut Short 162 3 3
Strikes Price OI
(%) Chng since Expiry Opt CE
200 1 11
11000CE 122 (0.2) 34 6.7 21.1 Long 2.7 0.9
10900CE 179 2.3 19 10.4 30.2 Opt CE Short 74 4 29
Opt PE Long 323 9 14 1.9 1.0
10800CE 243 2.7 15.2 3.5 (12.9)
Opt PE Short 166 7 15
10800PE 108 (15.5) 26 26.4 110.7
10700PE 82 (17.0) 31 5.2 4.1

Since Expiry
OI Chg Price Chg Rollover
Underline OI
(%) (%) (%)
NIFTY 198.8 6.4 0.7 8.1
BANKNIFTY 14.7 1.8 (0.2) 1.9
CONCOR 23.2 43.2 (20.8) 0.1
DHFL 256.3 33.5 (14.3) 7.2
 Derivative
Cash and carry arbitrage Reverse cash and carry arbitrage
Spot Futures Basis Spot Futures Basis
Underline Basis Action Underline Basis Action
Price Price (%) Price Price (%)
Buy cash and Sell cash and
SUZLON 4.75 4.80 0.05 1.1 NHPC 25.20 24.40 (0.80) (3.2)
Sell future Buy future
254.7 Buy cash and Sell cash and
HINDZINC 257.05 2.35 0.9 VGUARD 195.50 190.75 (4.75) (2.4)
0 Sell future Buy future
SOUTHBAN Buy cash and Sell cash and
13.20 13.30 0.10 0.8 BPCL 338.55 330.60 (7.95) (2.3)
K Sell future Buy future

PCR Open Interest PCR Volume

Underline Current Previous % Change Underline Current Previous % Change

NESTLEIND 0.22 0.10 1.10 TATACOMM 4.67 0.18 25.67

KAJARIACER 0.30 0.19 0.63 REPCOHOME 6.00 0.60 9.00

EXIDEIND 0.77 0.53 0.45 SUZLON 1.22 0.13 8.25

SRF 1.28 0.88 0.45 MRPL 1.07 0.12 7.89

SHREECEM 2.25 4.00 (0.44) NESTLEIND 0.47 0.06 7.05

JUSTDIAL 0.32 0.22 0.43 KAJARIACER 0.46 0.08 4.72

BRITANNIA 0.52 0.37 0.42 WOCKPHARMA 1.46 0.28 4.15

EQUITAS 0.73 1.23 (0.40) EXIDEIND 0.80 0.19 3.24

RBLBANK 0.52 0.83 (0.37) MGL 0.19 0.05 3.19

MINDTREE 0.60 0.91 (0.34) GLENMARK 0.30 0.08 2.80

FII Long-Short ratio Historical Volatility of Active Stocks

3.0 400 HV % Chg

350
2.5
300
2.0
250
1.5
200
1.0
150
0.5
100
0.0 50
Index Future Index Call Option Index Put Option
Long/Short Long/Short Long/Short 0
RPOWER RCOM RELCAPITAL ADANIENT RELINFRA

Long/Short Ratio Long/Short Since Expiry

 News Snippets
CMP Suppo Resist 50- 200 SBIN 284 279 287 291 277
Company
(`) rt* ance* DMA -DMA
SUNPHARMA 415 408 422 434 531
ADANIPORTS 336 330 340 372 368
TCS 2050 2030 2063 1936 1913
ASIANPAINT 1446 1436 1455 1373 1317
TATAMOTORS 180 178 183 175 239
AXISBANK 721 711 727 641 586
TATASTEEL 476 459 486 497 555
BAJAJ-AUTO 2643 2581 2688 2713 2757
TECHM 749 740 755 708 697
BAJFINANCE 2594 2570 2621 2543 2396
TITAN 1026 1007 1047 941 896
BAJAJFINSV 6009 5963 6089 6214 6085
UPL 771 761 778 761 696
BPCL 339 336 342 346 359
ULTRACEMCO 3448 3401 3496 3863 3918
BHARTIARTL 307 302 311 316 348
VEDL 161 157 165 196 225
INFRATEL 295 289 299 270 284
WIPRO 371 368 375 335 302
CIPLA 510 504 518 517 584
YESBANK 180 175 184 186 280
COALINDIA 222 220 224 238 266
ZEEL 348 331 363 449 497
DRREDDY 2735 2674 2837 2631 2377
EICHERMOT 20128 19565 20562 21755 26004
Bulk deals
GAIL 330 327 332 342 351 Avg
B/ Qty
GRASIM 707 699 717 811 947 Date Scrip name Institution price
S (‘000)
(`)
HCLTECH 1045 1037 1055 973 985 GMO
HDFCBANK 2105 2087 2118 2106 2053 Emerging
HEROMOTOCO 2780 2717 2844 2997 3224 Amber Domestic
Enterprise Opportuniti
HINDALCO 204 200 209 215 227 4-Feb s (I) Ltd es Fund S 346 680.1
HINDPETRO 227 223 231 238 262
HINDUNILVR 1803 1791 1819 1789 1664 Insider Trading
HDFC 1979 1953 1993 1957 1888 Date Company Name Trader B/S Qty (‘000)
Cyquator
ITC 277 275 281 282 284
4-Feb ZEEL Media S 1097
ICICIBANK 355 348 359 361 321 Services
IBULHSGFIN 651 619 687 774 1034
IOC 136 135 138 136 151 Results Today
INDUSINDBK 1505 1479 1521 1559 1755
INFY 756 749 763 690 666
Feb 05: Aditya Birla Capital Ltd, ACC Ltd, Apollo
Tyres Ltd, Bharat Heavy Electricals Ltd, Birla
JSWSTEEL 274 269 277 294 331
Corporation Ltd, Blue Star Ltd, Brigade Enterprises
KOTAKBANK 1272 1253 1283 1235 1244 Ltd, Century Plyboards (India) Ltd, CESC Ltd, Dish
LT 1307 1298 1322 1379 1333 TV India Ltd, GAIL (India) Ltd, Hindustan Petroleum
M&M 674 667 685 737 838 Corporation Ltd, IDFC First Bank Ltd, Marico Ltd,
MARUTI 6988 6880 7068 7348 8192 Mangalore Refinery & Petrochemicals Ltd, Sobha
NTPC 137 136 140 144 158 Ltd, Symphony Ltd, Tata Chemicals Ltd, Tata Global
ONGC 146 143 148 145 162
Beverages Ltd, Tech Mahindra Ltd, Torrent Power
Ltd, Trent Ltd.
POWERGRID 185 182 188 190 193
RELIANCE 1291 1256 1311 1147 1099
 Divi’s Laboratories Limited
Reco Price: `1,280-1,300, Call Closure Price: `1,619.95

CALL SUCCESS We had recommended a buy on Divi’s Laboratories Limited in our

Sector Pharma Idea to Act report dated August 24, 2018 with a target price of
`1,646. The stock hit high of `1619.95 on February 04, 2019. The
Stock Data
total return delivered since recommended price range of `1280-
Sensex 36,341
52 Week h/l (`) 978/ 1619.95
1300 stands at ~25.5%. We recommend traders to book profit.
Market cap (` Cr) 42, 660
BSE code 532488
NSE code DIVISLAB
FV (`) 2.00
Div yield (%) 0.65

Shareholding Pattern
Jun-18 Sep-18 Dec-18

Promoters 52.03 52.02 52.01

DII+FII 34.62 34.31 34.98
Individuals 13.35 13.67 13.01
Source: www.bseindia.com

Share Price Trend

DIVISLAB Sensex

1650 39500
1500 38000
1350 36500
1200 35000
1050 33500
900 32000
Feb-18 May-18 Aug-18 Nov-18 Feb-19

Prices as on 02/02/2019

Analyst- Hadrien Mendonca

research@iifl.com

February 04, 2019

 News Snippets
Corporate Snippets: The bank sought approval for name change
 Dr. Reddy’s Laboratories stock in focus as to LIC IDBI Bank (first preference) or LIC Bank
Indivior loses bid for rehearing in Suboxone (second preference).
Patent Case. Indivior Plc was rejected by a Economy Snippets:
US appeals court in its effort to prevent Dr.
Reddy’s from selling a generic version of  Senior officials of department of commerce
Suboxone Film opioid addiction treatment. will meet exporters and export promotion
 The Telecom Tribunal cancelled a Rs2,000cr councils in the wake of slowing growth of
demand on Reliance Communications, various exporting sectors.
upholding the company’s petition against  GST has come as a challenge for government
Telecom Department on one-time spectrum auditor CAG as huge numbers are to be
charge issue. worked, Comptroller & Auditor General of
 Coal India approved a buyback of 4.46cr India (CAG) Rajiv Mehrishi said.
equity shares or 0.72% of outstanding equity  SBI Chairman Rajnish Kumar Monday said
shares at Rs235 per share aggregating up to nobody can make an authentic statement on
Rs1,050cr. job creation or jobless economic growth as
 M&M said that the company will offer pro- there is no reliable data of jobs in the
active inspection of Rear Axles on its Imperio country, unlike in the USA, which has such
vehicles manufactured between April to data.
June last year. Inspection to be carried out
free of cost and the company also stated Results Table:
that this action is in compliance with SIAMs Revenue YoY PAT (` YoY
Company
voluntary code on voluntary recall. (` Cr) (%) Cr) (%)
 Ashok Leyland acquired 4.50 lakh shares, Aditya Birla
Fashion and Retail 2,282 23.0 70 101.8
constituting 11.25% in the paid-up share Bombay Burmah
capital of Ashley Aviation. Trading Corp 55 10.0 12 NA
 HEG board has approved the appointment of Exide Industries 2,497 9.7 155 0.5
Gulshan Kumar Sakhuja as Chief Financial Godrej Agrovet 1,454 19.1 41 9.1
Officer of the company while group arm- Greaves Cotton 506 13.2 43 (23.2)
Bhilwara Energy’s Chief Executive Officer OP Grindwell Norton 395 8.0 41 3.1
Ajmera will also become the group CFO. KEI Industries 1,087 22.4 48 24.0
 Moody’s has changed Vedanta’s outlook to SRF Ltd 1,964 40.6 166 26.3
negative from stable, affirms all ratings.
 Bharat Financial Inclusion completed its
seventh direct assignment transaction of
Rs751cr. With this, the company said direct
assignment transactions worth Rs5,448.4
have been completed in financial year 2019.
 IDBI Bank applied for a name change post
LIC’s acquisition of majority shareholding.
 Event Calendar
Sunday Monday Tuesday Wednesday Thursday Friday Saturday
1-Feb 2-Feb

3-Feb 4-Feb 5-Feb 6-Feb 7-Feb 8-Feb 9-Feb

Nikkei India PMI
Services
Nikkei India PMI RBI policy meet
Composite

10-Feb 11-Feb 12-Feb 13-Feb 14-Feb 15-Feb 16-Feb

Jan Imports YoY
Jan CPI YoY
Dec IIP YoY Jan Exports YoY

17-Feb 18-Feb 19-Feb 20-Feb 21-Feb 22-Feb 23-Feb

24-Feb 25-Feb 26-Feb 27-Feb 28-Feb

Q4 GDP
YoY
2019 GDP
annual
estimates
YoY
Jan Fiscal
Deficit
Jan Eight
infra
industries
data
 Disclaimer
Recommendation Parameters for Fundamental/Technical Reports:

Buy – Absolute return of over +10%

Accumulate – Absolute return between 0% to +10%
Reduce – Absolute return between 0% to -10%
Sell – Absolute return below -10%

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