STOCK IN FOCUS
JSW Steel closed 1% higher on 1.4x its average volume and outperformed the CNX metal index by 1%. The company will be the biggest beneficiary once the MMDR bill is passed as the ordinance paves way for new mine auctions as all new leases to private companies, which will be granted through a competitive bidding process, compared to the allotment route earlier.
It must be noted that mine-award process had come to a standstill due to lack of clarity regarding various illegalities associated with iron ore mining and investigation by the Supreme Court appointed committee.
We continue to remain positive on JSW steel as going forward, with increase in sales of value-added products and revival in domestic steel demand; margins are set to improve
leading to higher profitability.
At the CMP, the stock trades at 4.3x FY17E EV/EBITDA; we maintain our BUY rating on the stock with a target price of Rs1,461.
INTRADAY PICKS
POWERGRID (LTP: 146) SELL For today's trade, short position can be initiated only in Rs.148-149 range for target of Rs.142 with a strict stop loss of Rs.150.
HEXAWARE (LTP: 274) BUY For today's trade, long position can be initiated only in Rs.269-266 range for target of Rs.280 with a strict stop loss of Rs.263.
Positional Stock Recommendation
Bharti Airtel lost 4.6% in last four trading sessions, as it is facing stiff hurdle from the upward slopping trend line.
We believe stock will remain in pressure till the time it trades below that trend line, as it had visited lower level of Rs.340 post visiting the same. Fall in weekly RSI (14,9) is also signaling lack of strength in the stock.
Thus, for today's trade, short position can be initiated only in Rs.395-405 for target of Rs.360-340 with a strict stop loss above Rs.415.
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