MOSt Market Outlook
22nd August 2017
Nifty Chart
Nifty Outlook
Index
CMP
R1
R2
S1
S2
Nifty Cash
9754
9820
9880
9710
9600
BankNifty
23936
24250 24500 23750 23500
Nifty index failed to hold above its crucial hurdle of 9880 and
corrected sharply after breaking its immediate support of 9775
mark. During the day it fell down towards 9740 and finally closed
the session with the loss of around 83 points. It formed a bearish
candle on the daily chart and closed below to its 50 DEMA which
has a negative implication if follow up selling continues. It is just
few points away from the major support trend line by connecting
the lows of 9088, 9448, 9685 and 9720. If this trend line is broken
decisively then short term trend may continue its pace of selling
pressure towards 9600 zones while on the upside resistances are
shifting lower to 9820 and 9850 marks.
Currency (USDINR) Outlook
USDINR
64.20
SL
149
Market Drivers
Indian markets moved lower moving closer to the
lows of the month driven primarily by likes of Infosys.
Infy was once again a big loser. Banking also lost some
ground. The last legs of results have not been
encouraging. Flows have continued to be negative
from FIIs. Geopolitical issues, earnings
disappointment, high valuations and stock specific
issues have affected markets. Infy in the US market
managed to hold ground which should help the stock
find some support. Essar Oil deal will be supportive
for banks. Overall post the sharp decline, we could
see some consolidation but trading sentiment is likely
to remain tentative.
Trading Idea - Cash & Future
Scrip
Bank Baroda
S1
64.00
S2
63.80
R1
64.40
R2
64.55
Reco
Sell
MSP
145
Target
136
Sideways consolidation in the range of 64 - 64.40 will be seen in
short-term.
Highest Call OI
Instrument
Nifty 31 - Aug
Bank Nifty 31 - Aug
Bank Nifty 24 - Aug
Strike
10000
25000
24500
OI
5896800
1178720
871000
Chg in OI
-7125
-43320
253520
Corporate Action:
Dividends
-MANINFRA, ENIL, GINISILK, MANAPPURAM, OBIL,
PFIZER, PFIZER, SAFARIND, SHARDA, TRIVENI
KANCOTEA - Bonus issue 2:1
Sectoral Outlook
Sector
PUS BANKS
AUTO
Outlook
NEGATIVE
NEGATIVE
Highest Put OI
Instrument
Strike
9800
24000
23000
OI
5327100
1099960
442240
Chg in OI
-565725
127640
89040
Nifty 31 - Aug
Bank Nifty 31 - Aug
Bank Nifty 24 - Aug
Security in Ban period:
BEML, FORTIS, HDIL, IBREALEST, JPASSOCIAT, JSWENERGY,
JUSTDIAL
Trading Idea - Derivatives
STRATEGY UPDATE : TATASTEEL BULL CALL SPREAD
Instrument
B/S
Lot
Reco
CMP
TATASTEEL CE 630
TATASTEEL CE 640
Buy
Sell
1
1
12.00
8.00
8.35
5.00
Today Event
Board Meetings - care Ratings, GATI, NIIT Ltd
AGM - Eclerx, Hindustan Copper, L&T, MCX, Reliance Defense,
Tata Motor, Tata Motor DVR
EGM - L&T, Results - CARE Ratings and GATI
Reward / Target: 12000, Risk / SL: 8000

MOSt Market Outlook
22nd August 2017
Trading Calls
Bank Baroda
Sell
MSP :
Target :
INR 145
INR 136
Derivatives Idea
TATA STEEL
BULL CALL SPREAD
Buy 1 Lot 630 CE
Sell 1 Lot 640 CE
Price is in a very sharp decline and the small pull back rally
seen in last couple of days allows us to sell short this stock
3
It broken the support of 149 and now holding below this major
support zone
3
It may see a decline towards 136, thus suggesting to sell on a
bounce back move with a stop above 149 for a downside target
3
3
3
3
3
3
3
Positive sector outlook with sustained buying at every small
decline
It has been making higher top – higher bottom on weekly chart
and given a decent weekly close
A hold above 630 could take the stock towards 640-645 zones
Fresh Put writing at 620 strike suggests limited downside
Call unwinding in 620 and 640 strike suggests an up move
Thus low risk Bull Call Spread is recommended
FII & DII Activity (INR in Cr)
FII F&O
18th Aug
-2182.12
584.59
17th Aug
-981.05
828.59
Institution
INDEX FUTURES
INDEX OPTIONS
STOCK FUTURES
Net B/S
486
194
348
OI
Long Built Up
Call Long
Long Built Up
Cat.
FII
DII
21st Aug
-1983
475

MOSt Market Outlook
22nd August 2017
Long Built-up
Short Built-up
Long Unwinding
Short Covering
Nifty Option OI
1- Day change in Nifty OI

MOSt Market Outlook
22nd August 2017
Research Notes
Morning Meet Notes
Infosys - (CMP 874, TP1030, Recom BUY)
o
The fall in valuations (14% in two sessions) may be stemmed amid the buyback
o
Return of business stability may be prolonged
o
New CEO search, Peace between the current Board & Mr. Narayana Murthy
o
Factors may limit upside in INFO despite attractive valuations - Key man risk plays out, Comforting clients is another challenge
o
We value it at TP of INR1,030 (15x forward earnings) implies a 17% upside
MindTree Consulting - (CMP 462, TP 450, Recom Neutral)
o
Getting ready for the next phase…
o
Differentiated proposition in Digital
o
Revenue growth outlook downgraded in 1QFY18
o
Near-term profitability challenges
o
Our price target of INR450 discounts forward earnings by 13x
Gateway Distriparks - (CMP 237, TP272, Recom BUY)
o
Reported EBITDA (Rail + CFS) of INR450m (-19% YoY, -14% QoQ)
o
PAT of INR180m (-20% YoY, -19% QoQ)
o
Rail reported EBITDA of INR252m (-24% QoQ), Rail realization stood at INR32,810/TEU (-12% QoQ), EBITDA/TEU dec 20% YoY
o
Container volumes stood at 51,000TEU (-12% QoQ)
o
Consol. CFS EBITDA +3% QoQ, Consol. volume stood +5% QoQ, Realizations at -1% YoY, EBITDA/TEU at -2% QoQ
o
We value it at TP of INR272 (CFS business at 11x FY20E earnings, Rail segment at 12x FY20E EV/EBITDA)
NTPC - (CMP 173, TP 204, Recom BUY)
o
Kudgi (3 x 800MW = 2,400MW): On track for full CoD in FY18
o
Solapur (2 x 660MW): Expect unit-1 CoD by September 2017
o
Expect regulated equity to grow at ~20% CAGR and consolidated PAT to grow at 12% CAGR over FY17-20
o
Earnings growth to accelerate; valuations attractive

MOSt Market Outlook
22nd August 2017

MOSt Market Outlook
22nd August 2017
Currency Ideas
USDINR
EURINR
3
3
3
USDINR trade in a sideways range in the previous session closing at 64.20.
Immediate support remains at 64.00 whereas resistance is pegged at 64.40.
The consolidative range move is likely to continue for the session and price
break on either side of 64.00 - 64.40 will signify further trend direction.
3
EURINR traded sideways with positive bias in the previous session closing at
75.52.
Critical support for pair remains at 75.00 whereas resistances are at 76.20
levels.
Bias looks positive for the pair and dip towards 75.40 will be good buying
opportunity for short-term targeting 76.20.
3
3

MOSt Market Outlook
Chandan Taparia
Research Analyst (Derivatives & Technical Analyst)
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MOSt Market Outlook
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