WEEKLY TRENDSETTER (June 10th,2022)
| 2022 | May 27 | June 3 | Ch % |
| NIFTY | 16352 | 16584 | 1.42 |
| BANK NIFTY | 35613 | 35275 | -0.95 |
| USD/INR | 77.59 | 77.61 | 0.03 |
MARKET REVIEW–The mood of the market is circumspect and rallies are getting sold into. The Nifty is slowly losing ground and the coming week could be testing for the bulls after 3 weeks of recovery from the lows of 15900.
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 |
| Everest Kanto | 479(+68) | 64.8(+999) |
| Minda Corp | 948(+19.4) | 75.5(+952) |
| Karnataka Bank | 1579(+11.4) | 130.2(+315) |
| Jain Irrigation | 2084(+16.2) | 279(+478) |
Everest Kanto (209)- The company is into manufacturing seamless steel gas cylinders in India with aggregate capacity of over 9 lac cylinders annually in India (7 lac) and abroad (UAE and US). The corresponding previous quarter was a difficult one with an exceptional write off also taking toll of the bottomline. However, on a sequential basis some margin pressure is visible but the company has been able to maintain a steady growth. It’s a remarkable turnaround story which has seen debt reduction, operational turnaround resulting in an EPS of Rs 25 for FY22.
Minda Corp (211)-The company is an auto ancillary which has seen steady performance over the years. The March quarter saw another decent performance enabling it to post EPS of Rs 3.46. The company has 2 business verticals namely mechatronics (58%), information and connected systems (42%) with supplies to almost all OEMs and has 32 manufacturing facilities. The stock has seen buying activity at lower levels.
Karnataka Bank (66)-Thebank saw a decent quarter with improvement in NIM to 3.25% and lower provisions. The management has indicated loan guidance of 15% for FY22-23. However, it has concerns over high restructured book. The scrip has largely been an underperformer though at current levels could see a decent uptrend.
Jain Irrigation (38)-Besides being a pioneer in drip irrigation, the company is also the largest manufacturer of plastic pipes. The tissue culture division has capacity to produce several fruits like banana, pomegranate, strawberry. The March quarter has seen some benefits of restructuring of debt into equity which has reduced the interest burden significantly. If the company is able to sustain its growth in topline, profitability could accelerate in the coming quarters. Considering that drip irrigation is a high potential space, the scrip could remain a dark horse though it has tested investors patience.
MARKET OUTLOOK
Some technical cues are as follows going by market trends: –
NIFTY-The index made a spirited attempt to close above 16700 but the profit-taking sentiment was to prevail which resulted in the index closing below 16600.It has managed to hold on to 15900-16000 levels.16300-400 should provide support for the coming week while 16600 could be a hurdle.
BANK NIFTY– The 50dma resistance of 35750 played out and the index saw a sharp cut towards close of week with the index closing below 35300 which does not auger well for the coming week. Some breakdown to levels of 34800-35000 is possible in the coming week. Opportunistic buying could be considered there.
SCRIPS TO WATCH OUT
Gujarat Gas (556)-The scrip touched a high of 786 last year and since has gone on a corrective mode. Levels of 480-520 have seen decent accumulation. Buying can be considered at declines for a possible target of 650.
Hindustan Foods (1939)-The scrip has seen a good consolidation in the 1750-1850 range. While volumes are low, the scrip could be bought at declines for a possible target of 2500
Have a great trading week!
Note: Any queries /clarifications may be addressed to stockmasala@gmail.com .
Krish Subramanyam