WEEKLY TRENDSETTER (MAY 15TH ,2021)
| 2021 | MAY 7 | MAY 14 | Ch % |
| NIFTY | 14823 | 14678 | -0.97 |
| BANK NIFTY | 32904 | 32169 | -2.23 |
| USD/INR | 73.45 | 73.28 | -0.23 |
MARKET REVIEW –The week started on a positive note but saw some profit-taking when Nifty went past 14900 and again took support around 14600. While the Nifty has been in a range, the broader market also saw some profit taking. The FII s were largely sellers during the week with metals witnessing some sharp profit-taking and even pharma counters witnessed the same.
REVIEW OF RESULTS (MARCH QTR)
With the result season getting into high gear, focus this week is on some outstanding performance for the March quarter.
Rs in cr, Bracket indicates ch in %
| Company | Revenue | Net profit |
| Kennametal | 228(+24) | 22(+127) |
| CDSL | 103(+72) | 51.6(+84) |
| Kesoram Inds | 862(+62) | 96.4 (loss of 82) |
| JSW Ispat Spec | 1477(+140) | 92.9(loss of 104) |
Kennametal-The company is into manufacture of high-end machine tools with exports to Japan, Germany among other countries. Besides a robust set of working another interesting development is the Board approval to merge WIDIA India, a wholly owned subsidiary of Kennametal India w.e.f April 1,2021. The company is positive on the development as it is expected to bring techno-commercial synergies to customers.
CDSL-One of the largest beneficiaries of the rise in retail participation in the equity markets over the last one year, the company posted decent results. It has got an interesting revenue stream like transaction charges, account maintenance charges besides annual fees, corporate action and e-voting charges from companies. During the last financial year, the company added 1.23 cr accounts and the total number now stands at 3.34 cr.
Kesoram Inds-The debt strapped company now looks like getting out of troubled times going by the management commentary. It is now a predominantly cement company after demerger of its tyre unit into a new entity, Birla Tyre.The company has a 7.5-million-ton cement capacity and the management expects an EBIDTA of Rs 500 cr for FY21-22. The company has a debt of Rs 1842 cr but with a rights issue besides other issuances it is expected to become debt-free in the next couple of years. With the cement industry on a high, this could possibly be the best time to get the company into proper shape. Patient investors could finally give a sigh of relief!
JSW Ispat Specialities-The erstwhile Monnet Ispat has got some fresh oxygen after getting into the JSW fold. With a 2nd quarter of sequential profits, the company looks to ride out of trouble with the steel industry having a robust time. The company has a 1.5 MTPA capacity to produce HR plates, rebars, and structure profiles to cater to the infra and construction industry.
MARKET OUTLOOK.
1.The immediate concern for the markets is the reducing level of economic activity across India as restrictions and lockdowns are being witnessed in many States and despite expected vaccination drive, the Covid cases have continued to rise. This uncertainty could dampen the 1st quarter performance of companies similar to the last corresponding quarter.
2.Major results for next week are Bharti Airtel, Tata Motor, IOC, HPCL, Havells, Shree Cement, JSW Steel besides others.
2.Technically, the Nifty remained in the range. For the coming week again 14900 levels could see profit -taking. However, this narrow range is unlikely to continue for long as the VIX seems to suggest. It jumped from 17 to 29 last week before closing at 23. Besides even global cues are turning volatile with DOW witnessing profit taking around 34500 levels. Metals, pharma and IT have also seen bouts of profit -taking though the trend still looks bullish. Thus, some caution could be exercised at higher levels.
Some technical cues are as follows going by market trends
Scrips to watch out
HPCL (254)-The scrip saw some spirited action and raced to 267 before profit-taking pulled it down. The 250-55 band should attract buying again and the scrip could see levels of 280 and above in the coming days.
Himadri Speciality Chemicals (50)-This was a high-flying scrip in the 2017-19 period. However, the correction that followed engulfed all the bullishness and the price fell to levels of 30. While it has not participated in the last one year ‘s rise in markets, it has seen very good consolidation in the 35-45 band. Long term charts suggest that the scrip could gradually gain ground to touch levels of 75-80.
AMARA RAJA BATTERIES (771) –The stock has been an underperformer over the past few weeks and is also now consistently trading below its 200-dma. The stock could see levels of 700 in the coming days.
Health is wealth in these trying times. While this too shall pass, till then take care as the future is ours, if we ride through this present turmoil!
Have a great trading week!
Krish Subramanyam