WEEKLY TRENDSETTER (AUGUST 9,2024)
| 2024 | JULY 26 | AUG 2 | Ch % |
| NIFTY | 24834 | 24717 | -0.47 |
| BANK NIFTY | 51296 | 51350 | +0.11 |
| USD/INR | 83.72 | 83.75 | +0.04 |
MARKET REVIEW-The week did see 25000 on Nifty being conquered but the joy was short-lived as geopolitical tension again resurfaced which resulted in markets tumbling towards close of week. The weekend should be critical as the situation continues to be tense. Near -term market looks uncertain.
BACK TO RESULT SEASON
June quarter results are trickling in. Let’s explore some of them to get cues of where the stocks could be heading
Rs in cr, Bracket indicates ch in % against June,23 quarter.
| Company | Revenue | Net profit |
| TVS Supply | 2539(+8.4) | 6.47(+999) |
| PG Electroplast | 1321(+94) | 85(+150) |
| Rattan Power | 932(+10) | 93(+999) |
| Dixon Tech | 6580(+101) | 132(+106) |
TVS Supply (189)-The company has been consolidating on its domestic and international operations. The Integrated Supply Chain Solutions (ISCS) accounted for 53% of the revenue and Network Solution (NS) the balance. The company has an order book of Rs 4000 cr. The current Union budget has opened up more opportunities as per the management. The company had come out with an IPO 2 years back. It has been judiciously reducing debt levels though interest coverage is still less than 2. Cash profits generated should come in handy in the coming years as the CEPS stands at 3.3. Clearly a stock for the long term.
PG Electroplast (434)-The company is involved in plastic moulding, specialized AC components, tool manufacturing assemblies, polyurethane paint, etc. It has had a scorching growth in the last 3-4 years with topline rising almost 4 times to 2700 cr and net profits growing 13 times to 137 cr. The June quarter has seen another impressive set of numbers. With an EPS of Rs 52 for FY24 and with the user industries holding promise, the stock could be added at declines.
Rattan Power (17.30) -The company has posted a turnaround in operations thanks to some remarkable financial re -engineering which saw interest costs falling from Rs 678 cr to Rs 121 cr in the last few quarters. Debt still looks at an elevated level but with improving cash flows and operations and a strong promoter background, the company is poised for better times. Additions at lower levels could be considered.
Dixon Tech (11654)-The company provides design focused solutions in consumer durables, home appliances, lighting, mobile phones and security devices to customers across the globe, along with repairing and refurbishment services of a wide range of products including set top boxes, mobile phones and LED TV panels. The Govt’s PLI scheme has recharged the company enabling it to have stiff targets. It has committed a cumulative production value of Rs 48000 cr in 6 years. While the turnover has quadrupled to Rs 17690 cr in a 4-year period, profitability has not kept pace as it has increased 3 times to Rs 364 cr during the same period. The stock looks expensive but if margins improve it could have a dramatic impact on its bottom-line.
NIFTY –The index saw a volatile week. Though there was a sharp fall on the last day, it still managed to close well above 24500.The early part of next week could be testing as indications are that lower levels will be touched in which case 24200 should ideally hold. The budget day low of 24040 will be critical
BANK NIFTY-The index is trying to claw back and closed in the positive for the week. The budget day low of 50438 will be critical for next week if the market witnesses another round of selling. Any upside could see resistance at around 52200.
PICKS FOR THE WEEK
CESC (179)-The stock has been a late mover among the power pack. After a breakout past 120 it has seen a steady rise. Any correction to lower levels of 170-75 should see buying emerge. The scrip could see levels of 200 in the coming weeks.
Hind Zinc (652)-After a sharp rally from 300 to 800 the stock witnessed profit-taking and has taken support at around 600.Ideally levels of 625-30 should be ideal for entry for a possible target of 700.
Wishing all readers, a great trading week!
Note: Any queries /clarifications may be addressed to stockmasala@gmail.com .
Krish Subramanyam