WEEKLY TRENDSETTER (MARCH 11TH,2022)
| 2022 | FEB 25 | March 4 | Ch % |
| NIFTY | 16658 | 16245 | -2.48 |
| BANK NIFTY | 36431 | 34407 | -5.56 |
| USD/INR | 75.28 | 76.18 | 1.20 |
MARKET REVIEW–The entire week had the Ukranian war in spotlight which continued to hamper sentiments and global and domestic markets went into a tailspin. Going into weekend the situation has not changed but any resolution or ceasefire could also see a sharp recovery in markets.
INTERESTING TIDBITS
ETHANOL BLENDING could gather momentum -India is on course to achieve a minimum of 10 % average ethanol blending across the country in the current supply year, 2021-22, if the quantities offered and finalized so far by the oil marketing companies (OMCs) and sugar firms are any indication. In the 3.76 bn litres of ethanol contracted for supply, a bulk of the supplies around 63 % will come from B-heavy molasses, followed by directly from sugarcane juice (18.54 %) and then from maize or corn (10.55 %). According to trade sources, to achieve the 20 % blending target by 2025, India will need to produce 10-11 bn litres of ethanol, of which 6-6.5 bn litres will come from sugarcane, while the rest will have to be contributed by corn- and grain-based sources.
The last few weeks spike in crude oil prices past 100$ has increased the need to accelerate the blending process. This could result in sugar companies prospects improving in the coming quarters.
CIPLA ‘s strong launch pipeline puts it in focus
The company recently got approval from USFDA for its Lanreotide injection which is used for hormonal disorders and addressing symptoms of neuroendocrine disorders. The drug is similar to Somatuline Depot of Ipsen Biopharmaceuticals which had sales of $867 million for the 12-month period ended October. Given that the competitive intensity for Lanreotide is likely to be lower than other generic products, it is expected that the opportunity from the drug to be sizeable. Going into the 2nd half of FY22-23 launch of the inhaler Advair and cancer drugs Abraxane and Revlimid, and the multiple products in the pipeline could be potential growth triggers for the company.
MARKET OUTLOOK
Some technical cues are as follows going by market trends: –
NIFTY-The index closed below the 3-month low of 16410 on the back of the ongoing Ukrainian crisis. Volatility could be expected to be high as traders engage in opportunistic trades. The coming week could see 15950-16000 acting as a good support zone and a bounce could be expected which could see the index bouncing upto levels of 16400-500.
BANK NIFTY-The index saw a deep cut and the private banks heavyweights bore the brunt of selling pressure. For the coming week 33500-600 could be levels to watch out where short covering could emerge. On the upside 35000-35500 could see profit taking.
SCRIPS TO WATCH OUT
CIPLA (932)-The scrip has been in a band of 875-1000 for the last few weeks. Some resilience is seen at lower levels. On any recovery the scrip could advance to levels of 1000 which would be the break out point. Accumulation at declines could be considered.
Kennametal India (1939)-The scrip has been under accumulation on every dip with good support around 1800 levels. It could be an ideal investment stock which could be considered for buying at dips. Levels of 2400-500 could be expected in the medium to long term.
Have a great trading week!
Note: Any queries /clarifications may be addressed to stockmasala@gmail.com .
Krish Subramanyam