SENSEX (27177) BSE Sensex opened positive but wiped all the gains throughout the day. The index was dragged sharply by Oil& Gas, Pharma & Banking sector, thus making it to settle the day with the loss of 261 points. Now, it has to cross and hold its 27500 levels bounce back and witness buying interest towards 27700 and psychological 28000 levels while on downside immediate support exists at around psychological 27000 levels
STOCK IN FOCUS
Maruti was up over 3% in yesterday’s trade as it reported stellar 4QFY15 earnings ahead of street expectations by over 20% as margins expanded by staggering 269bps qoq. The
company reported a 13% yoy growth in revenues as volumes grew by 7%yoy and realizations improved due to better mix and lower discounts. EBITDA margin for the quarter expanded by a strong 300bps qoq to 15.9% blustering our expectations of 13.7% margins as the company benefited from yen depreciation, discounts cooling off and benign raw material prices. Strong operational performance meant PAT growing by
61% yoy 20% ahead of our estimates.
We have been highlighting Maruti as our top pick to play recovery in the Indian Automotive sector and continue to believe so as: 1) the company is in the midst of a best model cycle with strong new products pipeline 2) recovery in urban demand 3) slow and steady decline in discounts 5) robust margin expansion and 6) market share wins .
INTRADAY PICKS
AXISBANK (LTP: 524) BUY For today's trade, long position can be initiated only in Rs522-518 range for target of Rs545 with a strict stop loss of Rs.514.
MOTHERSON (LTP: 455) BUY For today's trade, long position can be initiated only in Rs.448-444 range for target of Rs.465 with a strict stop loss of Rs.442.
UPL is holding the gains even after the sharp decline in broader markets. It has been formed a bullish engulfing pattern on daily chart and is moving after taking support at its 50 day moving average. Thus looks strong to see the positive price action as it managed to cross and close above its hurdle of 443 levels. Traders can buy the stock between 437 to 441 with stop loss of 430 for the upside target of 457 levels.
TATASTEEL is moving after taking multiple support and looks attractive in terms of risk reward ratio. It has negated its negative trend and forming higher high – higher low from last four weeks. It is moving after the long correction from 568 to 311 in previous eight months thus, showing the potential to move towards 377 and higher levels. Traders can buy the stock between 361 to 365 with stop loss of 356 for the upside target of 377 levels..
Technical Stock Recommendations
SBI, witnessed sharp sell-off in yesterday's trade with stock closing the day with the loss of about 3.1%. Thus, stock has once again closed below its 200 day SMA which is currently placed around level of Rs278. Both MACD and RSI continues to depict the weak trend in the stock with next major support placed only at Rs235-240 range once the stock closes below level of Rs255. Combination of short and long term averages in the range of Rs280 to Rs300 will keep stock under pressure at higher levels.
Thus, for today's trade, short position can be initiated only in Rs.280-290 range for target of Rs.240 with a stop loss of Rs.305.
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