WEEKLY TRENDSETTER (APRIL 29th,2022)
| 2022 | April 22 | April 29 | Ch % |
| NIFTY | 17475 | 17172 | -1.73 |
| BANK NIFTY | 37463 | 36044 | -3.79 |
| USD/INR | 76.16 | 76.43 | 0.35 |
MARKET REVIEW–The week was a harrowing one for both bulls and bears alike but the latter will be more relieved after the closing for the week which clearly signalled that the coming week could see the index shedding more ground.
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 |
| Cyient | 1181(+8) | 154(+49.6) |
| Rajratan Global | 247.6(+34.8) | 37(+59.5) |
| Mindtree | 2897(+37) | 473(+49) |
| L&T Infotech | 4302(+31) | 637(+17) |
Cyient(918)-The company has posted sequentially the best results for FY21-22 which has ended with an EPS of Rs 50.The company enjoys gross margins of around 15-16% which is much below the margins enjoyed by its more famous peers of around 23-25% .Its DLM division (Design Led Manufacturing) has suffered due to the semi conducter shortage in the user industries despite having a fairly good order book position.The management has guided revenue growth at 13-15% for FY22-23 which is decent and if the DLM division comes back to normalcy the growth could be higher .However,the management does not expect this to happen atleast in the 1st half of FY22-23 .With an expected EPS of 55-60 in FY22-23 ,the scrip looks a decent bet .
Rajratan Global (630)-The scrip was in the news recently for a stock split and post the split it has reported in EPS of Rs 7.30. The company specializes in manufacturing of drawn steel wires for various industrial applications primarily in the automobiles and construction/engineering sectors. The coming years are going to be equally eventful with the upcoming expansion at Thailand and new greenfield facility at Chennai which will help increase the company’s local market share as well as cater to exports. The stock could be expected to give decent returns given its impressive performance.
Mindtree Consulting (3872)-The scrip clocked its best quarter with an EPS of Rs 29 on the back of a near 50% jump in bottomline. Sequentially also the EPS has jumped 8-9%. Interestingly there is media speculation that the company could be merged with L&T Infotech given the similar growth profile and margins. While L&T holds 74% in LTI, it holds 61% in Mindtree.
L&T Infotech (5094)-Another decent quarter which saw EPS of Rs 35. While the company has given guidance pointing at a strong growth momentum for FY22-23, it’s also needs to be noted that the company has rolled out salary hikes in Q1FY23. On valuation front the scrip looks fairly priced currently after the steep run up in the last few months.
MARKET OUTLOOK
Some technical cues are as follows going by market trends: –
NIFTY-The index saw a see saw movement with gap -ups and gap-downs on almost all days of the week. Going into expiry week the index looks to again test 17000 levels and possibly even 16800. Upside looks clearly capped at 17300-400.
BANK NIFTY-After a sharp cut of nearly 4% the index now looks the most vulnerable to a further fall to levels of 35100-35200 in the coming days.
SCRIPS TO WATCH OUT
Finolex Inds (152)-The scrip has seen a decent correction from 268 to 160 in the last few months. It took a long-term support at 140 before a bounce back. The scrip could be looked at for accumulation. Levels of 190-200 could be expected in the medium to long term.
Hindalco (515)-The scrip has seen a sharp correction in the April series and going into expiry it could seek lower levels of 485-90 which is its 200-dma. Selling could be considered at current levels.
Have a great trading week!
Note: Any queries /clarifications may be addressed to stockmasala@gmail.com .
Krish Subramanyam