7/28/2019 Most Advisor http://slidepdf.com/reader/full/most-advisor 1/8 In This Issue Market Outlook for the month quity Market Outlook erivatives & Commodities Market Outlook arge Cap and Mid Cap Investment Ideas Model Advisory Portfolios ecommended Funds echnology Solutions obal Market ex 31-Dec-12MoM (%) YoY (%) nsex 19,427 0.4 25.7 ty 5,905 0.4 27.7 SE 100 5,898 0.5 5.9 w 13,104 0.6 7.3 sdaq 3,020 0.3 15.9 ng Sang 22,657 2.8 22.9 y Indicators Current Month Change (%) (Oct) 8.20% -2150.00 PI (Nov) 7.60% 4.97 Year Yield 8.05% -1.47 D/ INR 54.79 0.74 ude ($) 111.1 -0.09 ld (10 gms) 30446 -2.33 onomic Pulse ought for the month Key Highlights for the Month Nifty trading range for Dec was just 2.4% lowest since 1 Nifty gained 27.7% in CY2012 on back of FII inflows of ` 1,30,147cr. Expect 50 bps rate cut in Jan RBI policy meet Dear Investor, The Nifty for the month of December closed at 5905 a gain of just 25 points (0.4%). Overall trading ran the month of December was just 142 points (2. lowest range in % terms since 1995. FIIs continued buying spree with inflows of ` 24,299cr, while remained sellers with outflow of ` 2,698cr. During whole of CY2012 Nifty ga 27.7% while FII infused ` 130,147cr, and DII sold ` 20,954cr during the same pe Winter session of Parliament concluded on a positive note with few important such as FDI in Retail, Banking amendment bill. On economic front IIP for the m of October rebounded to 8.2%, a high of 16 months, also Inflation for the M of Nov came in at 7.2%, while core inflation at 4.5% well within the comfort z However RBI in its policy meeting left rates unchanged; however, in its outlook i shift its focus towards growth and it also guided for a rate cut in 4QFY13. December month also marked revival in fund raising market with Bharti Infratel, C PC Jewels hitting the IPO markets, NMDC, Bluedart, Rpower, Honeywell etc thro OFS route and JP Power, Tech Mahindra etc raising money through Institut placement. With starting of 3Q FY13 result season we expect earnings downg cycle behind us, with an upgrade possibility. Best Wishes for 2013 Rikesh Parikh - Vice President Way Forward US Fiscal cliff being averted and with no other major concerns market will be loo forward to 3QFY13 corporate results and rate cut expected in RBI policy meet. On for earning multiple markets are trading at 14x still below historical average of 14.8x Rebound in the metal prices on LME could lead to inflationary pressure India's current account deficit widened to 5.4% of GDP in Q3 2012 Threats Opportunities 3Q FY13 corporate earnings could mark end of earning downgrade cycle 50 bps rate cut expected in RBI policy meet. January 20
Transcript
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In This Issue
Market Outlook for the month
quity Market Outlook
erivatives & Commodities Market Outlook
arge Cap and Mid Cap Investment Ideas
Model Advisory Portfolios
ecommended Funds
echnology Solutions
obal Market
ex 31-Dec-12 MoM (%) YoY (%)
nsex 19,427 0.4 25.7
ty 5,905 0.4 27.7
SE 100 5,898 0.5 5.9
w 13,104 0.6 7.3
sdaq 3,020 0.3 15.9
ng Sang 22,657 2.8 22.9
y Indicators Current Month Change (%)
(Oct) 8.20% -2150.00
PI (Nov) 7.60% 4.97
Year Yield 8.05% -1.47
D/ INR 54.79 0.74
ude ($) 111.1 -0.09
ld (10 gms) 30446 -2.33
onomic Pulse
ought for the month
Key Highlights for the Month
Nifty trading range for Dec was just 2.4% lowest since 1
Nifty gained 27.7% in CY2012 on back of FII inflows
of ` 1,30,147cr.
Expect 50 bps rate cut in Jan RBI policy meet
Dear Investor,
The Nifty for the month of December closed at 5905
a gain of just 25 points (0.4%). Overall trading ran
the month of December was just 142 points (2.
lowest range in % terms since 1995. FIIs continued
buying spree with inflows of ` 24,299cr, while
remained sellers with outflow of ` 2,698cr. During whole of CY2012 Nifty ga
27.7% while FII infused ` 130,147cr, and DII sold ` 20,954cr during the same pe
Winter session of Parliament concluded on a positive note with few important
such as FDI in Retail, Banking amendment bill. On economic front IIP for the m
of October rebounded to 8.2%, a high of 16 months, also Inflation for the M
of Nov came in at 7.2%, while core inflation at 4.5% well within the comfort z
However RBI in its policy meeting left rates unchanged; however, in its outlook i
shift its focus towards growth and it also guided for a rate cut in 4QFY13.
December month also marked revival in fund raising market with Bharti Infratel, C
PC Jewels hitting the IPO markets, NMDC, Bluedart, Rpower, Honeywell etc thro
OFS route and JP Power, Tech Mahindra etc raising money through Institut
placement. With starting of 3Q FY13 result season we expect earnings downg
cycle behind us, with an upgrade possibility.
Best Wishes for 2013
Rikesh Parikh - Vice President
Way Forward
US Fiscal cliff being averted and with no other major concerns market will be loo
forward to 3QFY13 corporate results and rate cut expected in RBI policy meet. On for
earning multiple markets are trading at 14x still below historical average of 14.8x
Rebound in the metal prices on LME could lead to inflationary pressure
India's current account deficit widened to 5.4% of GDP in Q3 2012
Threats
Opportunities
3Q FY13 corporate earnings could mark end of earning downgrade cycle
50 bps rate cut expected in RBI policy meet.
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uity Market Outlook
Nifty for the month of December closed with a gain of 25 points. The monthly range
was smallest in percentage terms since November 1995 i.e. 2.4%. After the formation
of Long Legged Doji on the daily chart, the index continued its consolidation in therange of the candle.
The weekly chart of Nifty indicates a formation of continuation pattern which has
breakout points at 5980 / 5820. Post breakout from the range, Nifty can be expected
to enter a directional movement. The trend can be assumed to remain positive until
Nifty breaks below 5820 on a closing basis. Upside target for the index on sustenance
above 5980 is at 6180.
Volatility Index has reached a mature phase of consolidation and oscillators are indi-
cating a possibility of a reversal. In the case VIX sustains above 17.50, that can be
taken as a sign of caution and exposure can be reduced from the market.
Cyclicals are expected to outperform defensives and with Nifty holding to stated support
level (5820), Auto, Infra, Realty, Mid-caps are expected to outperform. Metals is emergingas an improving sector and can have significant outperformance in the case Nifty
continues its up-trend. IT and Energy are the two sectors which can continue to lag
behind.
hnical Outlook
Support for the Index is placed at 5820
Resistance can be faced at 6180
NK NIFTY
Banknifty remains neutral relative to Nifty
Sector Rotation chart indicates marginal out-performancePrice chart has broken out from a continuation pattern of pennant
Resistance for the index can be seen at 13300 (Bearish Engulfing Pattern)
Key support for the index lies at 12280
Mid-cap banks are expected to outperform
ctoral Highlights
ector Our Views Top Pick Recommendation#
Auto Positive Maruti Buy above 1540
Midcap Bank Positive Federal Bank Buy above 545
Metals Positive Hindalco Buy above 134
T Negative Infy Sell below 2270
Technical view for 1 month perspective
MOSL's Recommendations
Nifty
Markets & Our Recommendatio
On This P
Equity Market Out
Markets & Our Recommendati
uity Market Outlook
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• Long positions could be made above for a potential of 6180 & a stop below 5
• Sell positions could be made below 582
a potential of 5660 & a stop above 59
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erivatives Market Outlook
Markets & Our Recommendati
On This P
Derivatives Market Outlook, Commodities Market Out
rivatives Market Outlook
Dec Series witnessed Total Rollovers of 81% (6m-avg 82%), Nifty rollovers of 60%
(6m-avg 63%) whereas SGX Nifty rollovers stood at 76% (6m-avg 76%). Total Open
nterest at the start of Jan'13 expiry is ` 960.3bn as against ` 1074.2bn at the start of
Dec'12 expiry.
Stocks which have witnessed rise in Near Month OI over the last 3 expiries include HDFC
Bank, Infosys, BHEL whereas stocks which have witnessed drop in Near Month OI over the
ast 3 expiries include Axis Bank, Hero MotoCorp, Sterlite.
In Jan series for Nifty, Highest Call OI is at 6000 strike with 5.5mn shares and highest Put
OI is at 5800 strike with 5.2mn shares.
Strategy : Long Strangle
Trade : Buy Nifty Jan 6000 CE@ 70 & buy Nifty Jan 5900 PE @ 71
View : Nifty has been trading in a narrow band of 5820 -5950 for over 1 month
now, expect it to move out of band. India VIX currently at 14.5 has been
trading near its bottom of 13.50, expect it to rise from current level.
Global VIX has already increased from 15 to 22, suggesting rise in volatility
in International market, our market could also follow.
rategy of the Month
MOSL's Recommendations
INDEX: BANK NIFTY LOT SIZE: 25
Strategy : Long Strangle
Premium Outflow : ` 7,050
Pay off Profile On Expiry
Break Even
Point
Maximum
Profit
Maxim
Loss
5759 & 6141 Unlimited 7050
mmodities Market Outlook
MOSL's Recommendations
Pay off Profile On Expiry
Commodity 1 month Bu
Return Se
Copper 2.43% Bu
Crude 1.77% Bu
Pepper 9.39% Bu
Gold -0.70% Se
Oil rose for a fourth straight year since the 2008 financial crisis. But annual gains were
modest as a weak global economy weighed on a strong couple of quarters.
Prices found support throughout the year from unrest in the Middle East that threatened
supplies, including Western efforts to halt Iran's nuclear ambitions through sanctions
against the OPEC nation.
Oil had a good run in the first and third quarters but slipped toward the year-end on U.S.
fiscal worries. But now as the senate cleared the "fiscal cliff" bill with a revenue increase of
$650 bn and postponed a decision on spending cuts by another 2 months we expect
crude prices might move on to hit $ 95 a barrel on NYMEX and on MCX prices might test
` 5150-5200.
k of the Month - Crude Oil
ommodity Stop Loss Target Duration
ude Oil 4980 4880 5200 1 Month
Crude Oil
CMP
as on 31st December 2012
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BUY
Karur Vysya Bank
CMP*: `554
Target: ` 725
Must
On This P
Large Cap Investment Ideas, Mid Cap Investment I
rge Cap Investment Ideas
Market & Our Recommendation
3 India's largest iron ore producer with a capacity of 32mtpa.
3 Iron ore volumes to grow at a CAGR of 13% to 39mtpa over FY12-15.
3 Post offer for sale, NMDC's free float of 20% could allow index entry.
3
Global acquisitions could add to growth.3 Reiterate our Buy with a target of ` 217.
3 Operating environment improving with stable labour relations & lower discounting.
3 Diesel engine availability to improve from Sep'13 with new capacity.
3 YEN weakening reduces payout on royalty and imports and adds to EPS.
3 Maruti to make cars in Sri Lanka and Africa - a true MNC.
3 Reiterate our BUY with a target of ` 1730 (10xFY14E CEPS).
One of the best managed private sector banks with 10 year CAGR of 20% in net profit
and delinquencies at less than 2%.
Business size to be 2x by FY16 as branches increase to 700 from 500 currently.
KVB has the highest dividend yield of 3% amongst all private sector banks and trades at
10% discount to them at 1.7x FY14E ABV (ex HDFC Bank).
We recommend to BUY with a target of ` 725 (2.25xFY14E P/BV).
Indian Jewellery market likely to growth at 14% CAGR with the organized sector
expected to increase by over 30% upto FY14.
TBZ is a 148 year old brand in premium and wedding jewellery.
TBZ is expanding its retail presence to 57 stores spread across 43 cities by FY2015 from
19 stores currently.
We expect profit CAGR of 40-45% over FY12-FY16E on the back of huge expansion in
retail presence.
Recommend BUY with a target of ` 330 (19xFY14E EPS and 12xFY14E EV/EBIDTA).
Data as on 4th January 20
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BUY
TBZ
CMP*: `260
Target: ` 330
d Cap Investment Ideas
January 2013
BUY
NMDC
CMP*: `164
Target: ` 217
BUY
Maruti
CMP*: `1,545
Target: ` 1,730
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crip MBP Wtg.
ajaj Finance 1390 12
DC 95 12
MDC 210 11
ata India 875 10
ngineers India 235 10ajaj Corp 235 10
cleod Russel 355 10
rient Paper Industries 80 10
nichem Labs 185 9
mami 590 6
otal 100
Sectoral Allocation For Whom
Investment Duration
Risk Profile
For few montto a year
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