WEEKLY TRENDSETTER (Nov 25th,2022)
| 2022 | Nov 11 | Nov 18 | Ch % |
| NIFTY | 18350 | 18307 | -0.23 |
| BANK NIFTY | 42137 | 42437 | 0.71 |
| USD/INR | 80.98 | 81.71 | 0.90 |
MARKET REVIEW–The week was one of the dullest in recent memory as the indices moved in a narrow range and just when it looked like the cut would be deeper for the week, short covering came to the rescue and the indices closed flat.
BACK TO RESULTS (Sept qtr.)
The Sept 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 us explore some of them:
Rs in cr, Bracket indicates ch in % against Sep,21 quarter.
| Company | Revenue | Net profit |
| Universal Cable | 514(+14) | 19.6(+999) |
| Taj GVK | 89.1(+59) | 32.1(+760) |
| Ethos | 177.7(+32) | 13.5(+410) |
| KCP Sugar | 82.1(+4) | 28.9(+238) |
Universal Cable(283)-The company has a strong presence in the cable industry covering high and low voltage cables,PVC cables,capactors,etc.The last few quarters have seen a surge in profitability and the EPS on trailing basis stands at 28!!.The surge has been despite high interest costs which has largely been a drag.On the same note it also needs to be mentioned that the revival has been a post Covid effect and prior to Covid the company had its best year in 2019.Thus the low discounting of the stock could be an overhang of the uncertainty seen in the last 3-4 years.Nevertheless it is a strong candidate for re-rating on the back of some consistent quarters .
Taj GVK (201)-The company is a venture between Indian Hotels and GVK Group. It operates 3 5-Star hotels in Hyderabad, one each in Chennai and Chandigarh. The company is setting up a 255-room hotel in Benguluru for which approvals have been received and expected to be completed in May 2024.A substantial other income component boosted the bottomline for the quarter. However, with the 2nd half of the financial year expected to be buoyant, prospects remain bright. Levels of 170-180 would be ideal for accumulation.
Ethos (882)-A new entrant in the market which went public in May, 2022.The company is one of the largest luxury and premium segment watch retailer in the country having almost 15% market share in the category. It has 50 retail stores in 17 cities in India besides having a strong digital presence. Interestingly the promoters also have a rich experience in the industry after setting up KDDL Ltd, which manufactures dials and high precision components for watches. The company has been a steady performer over the years. Ethos has posted a steady set of numbers for the quarter. With an expected Rs 25 EPS for the financial year and an experienced promoter, the stock looks interesting though the current market price looks stretched.
KCP Sugar (25.45)-The company is engaged in the manufacture of sugar, industrial alcohol, ethanol, bio-fertilizer, etc. While operationally the company has done well it also got a boost from an other income component. The company has an erratic track record which has affected investor confidence. However,it is a decent bet at declines considering the outlook for the sugar industry and the Govt giving a boost to ethanol production.
MARKET OUTLOOK
Some technical cues are as follows going by market trends: –
NIFTY –The closing for the week was with a loss of just 40 points. The index has taken the expected breather and the coming week could be volatile with monthly expiry being in focus. While banks have largely held ground, metals and IT could see some positive action as these sectors have been largely range bound to negative in the last few months. The index could see support at around 18200 on any correction while 18450-500 will remain near term resistances.
BANK NIFTY-The index closed at an all-time high for the week. The notable uptrend has largely been seen in PSU banks while the private sector banks have largely remained range-bound. Near term upside could see profit taking as the index approaches 43000.
SCRIPS TO WATCH OUT
J.B.Chem (2117)-The stock is one of the out-performers in the pharma industry.Technically it looks poised for a strong break-out .Accumulation at declines can be considered for a possible price target of 2400.
Kalyani Steel (319)-A low profile stock which has seen good accumulation at around 300 now looks poised for a steady rise to levels of 370.Accumulation could be considered at declines.
Have a great trading week!
Note: Any queries /clarifications may be addressed to stockmasala@gmail.com .
Krish Subramanyam