WEEKLY TRENDSETTER (MAY 27th,2022)
| 2022 | May 20 | May 27 | Ch % |
| NIFTY | 15782 | 16266 | 3.49 |
| BANK NIFTY | 33121 | 34276 | 3.07 |
| USD/INR | 77.14 | 77.71 | 0.74 |
MARKET REVIEW–The Indian markets again mirrored the global sentiments and though it closed on a positive note, the overnight positions were always at risk.
BACK TO RESULTS (March qtr.)
The March quarter results are getting announced. The small and mid-cap segments are the ones where some interesting results could be looked at. This week let’s explore some of them:
Rs in cr, Bracket indicates ch in % against Mar,21 quarter.
| Company | Revenue | Net profit |
| EID Parry | 5667(+45) | 430(63) |
| NXT Digital | 313(+17.9) | 84.5(+507) |
| Allied Digital | 156.4(+63) | 16.8(+3.9) |
| Refex Inds | 176.9(+16) | 24(+216) |
EID Parry-(492)-The company posted a stellar set of numbers on the back of turnaround in the sugar division with operating profit of Rs 194 cr. The farm input division continued with its profit trend with operating profit of Rs 397 cr. The company has initiated 120 KLPD grain-based ethanol project in Sankili which should come into operation in Q4 of FY 2022-23. The debt reduction programme helped in reduction of the finance cost from Rs. 93 cr in FY 20- 21 to Rs 46 cr in FY21-22. With an EPS of Rs 51 the scrip appears attractively priced.
NXT Digital-(380)-The company is a digital television platform that transmits signals to cable operators headend using satellite. It is part of the Hinduja group and has presence in many rural areas and semi-urban areas in large numbers affiliated to over 4500 Local Cable Operators (LCO) with a reach of over 3.5 million digital subscribers. On the performance front while there has been an operational profit for the quarter, high other income has boosted the bottomline. Interest costs are high which could continue to be a drag. At current levels the scrip appears fairly priced.
Allied Digital -(140)- The company has a long presence but because of the increased digital footprint in the last 2-3 years growth has accelerated and so has profitability. The company provides digital workspace services, enterprise infrastructure transformative solutions, cyber security services, cloud service and support to multi-lingual multi-channel service desks. Revenue has nearly doubled in the last one year and so has profitability. The scrip is richly priced clearly discounting the digital story.
Refex Inds (120)-The company is into manufacture of refrigerant gases, coal ash handling and power trading. It has posted significant improvement in operational working and also got an other income component which saw a surge in bottomline. With an EPS of Rs 15 and good growth momentum, the scrip looks attractively priced.
MARKET OUTLOOK
Some technical cues are as follows going by market trends: –
NIFTY-The index saw bounce near levels of 15700 which is close to the March low of 15671.Any bounce could carry the index upto 16500.With high volatility uncertainty could prevail as traders and investors sell out on any decent bounce.
BANK NIFTY– The index took support at 33000 and raced to 34655 before again dipping to 33180 and finally closing at 34270.The index could take support around 33500 on any correction and on the high side 34700-35000 could act as a stiff resistance area.
SCRIPS TO WATCH OUT
Refex Refrigerant (120)-The scrip has seen good buying support in the last one year and trading in a band of 120-150.Any overall correction in the market could be used to accumulate the scrip for the long term.
NMDC (144) –The scrip has largely been an underperformer in the last 1 year. However,130-140 levels have seen decent support. Buying at declines could be considered for a possible target of 160-165 in the short to medium term.
Have a great trading week!
Note: Any queries /clarifications may be addressed to stockmasala@gmail.com .
Krish Subramanyam