Nifty View - DENIP Consultants - Jan 2012 - Dewang K Mehta

Dear All,

The down trend that started on the Nifty since November 2010 from 6300+ levels on the Nifty is under significant threat.


I, have highlighted the tops with the help of a black trendline in the chart below.

We at DENIP Consultants believe that if we see a close above the 5220 mark on the Nifty we could see this downtrend end. A close above 5220 would definitely indicate the beginning of a major up trend which could last at least a year/ year and a half.

However for the short term traders, it would not be a bad point to initiate some speculative shorts. We would advise investors to start deploying cash into banking and metal stocks provided we see a close above 5220.

Do feel free to post your comments / views on the Nifty & get in touch with us in case you need to create a portfolio to encash this rally.

Thanks,
Dewang K Mehta
DENIP Consultants Pvt. Ltd.
Disclaimer Post applies.

Outlook 2012 - Fixed Income Investments

Hi,

Thank God that 2011 is getting over! 

It was a painful year for both investors and businesses. Policy uncertainty, higher cost of money, sticky inflation and global risk aversion created a toxic mix for risk takers. Equity investors struggled through the year with unprecedented volatility. Businesses were struggling with all the pain of directionless government, rising input, personnel and capital costs. No asset class managed to beat inflation, though fixed income came very close to protecting the purchasing power of your savings. 2012 holds better promises, particularly for fixed income. Most probably, it will beat inflation hands down and earn you real returns over next 1-2 years. However, investors have to evaluate the fixed income assets space a bit more rigorously.

Before you get lost in translation, here are the  key economy forecasts for 2012:

• 1.       Indian economy will grow at near 6.5% in calendar year 2012.
• 2.       Inflation (both WPI and CPI) would average at 5.50%-6.5% in this year.
• 3.       Effective monetary easing of 100 bps will materialise in this year, starting with April Policy. RBI will cut CRR by more than 2% during the year, bringing liquidity to near neutral in second quarter of the year.

Why would economy slow so much? For that, lets understand the actors which drove growth in our economy after the 2008 crisis. Massive fiscal and monetary stimulus were given to our economy as world was facing the financial crisis of 2008. Government spending shot up, taking our fiscal deficit to near 10% from 2.5%. Most of the incremental spending by the government went to the wallet of a common man, whose propensity to consume is very high.  Sixth pay commission, farm waiver, NREGA and various such schemes unleashed the consumption boom. Your uncles and aunts splurged. Life looked easy. Pundits concluded that India had decoupled from the rest of the world.

Alongside, there came a huge asset price boom.  Everyone in this country had a story to tell about how his friends and relatives became millionaires by buying some parcels of land. An already ‘earning more’ Indian got a booster dose of wealth effect. He was suddenly, richer too. And property price rise wasn’t the only reason for it.  A typical Indian is over owned in two asset classes, gold and real estate. At one end, government spending and loose monetary policies did magic to real estate prices and on the other, gold prices rallied for non-Indian reasons (Largely, driven by the chase for an alternate currency, as confidence in global currencies sank). Gold which is typically bought as an insurance by an average Indian, began to appear as investible surplus. Gold loan companies flourished as people began to leverage their gold holdings. So both gold and real estate price boom added fuel to the consumption boom.

But the times are different now. Both wealth effect and income effects, which drove consumption growth are fading. Property prices have stopped rising in most of the country for past 6 months. Gold prices too have come off (optically, they still look high due to currency depreciation) and are likely to come down secularly through 2012.

There are potentially three levers which can pull out the economy from cyclical slowdown i.e. government spending, exports (for that rest of the world should do well) and lower rates. Unfortunately, government spending, which is most potent of all doesn’t exist given that our government is already running very high fiscal deficit. Markets are punishing governments who borrow recklessly, and that’s why our Government bonds in India are trading at such high levels (near 8.30% right now) despite a significant risk of slowdown.

We struggle to forecast any optimistic growth scenario for most of the developed world and China, thus export is unlikely to prove as a major stimulant for domestic economic growth. The only good thing, in generally abused INR depreciation of last 3 months is that it will yield competitive advantage to our exporters and that will help reduce our current account deficit next year. We think current account deficit in 2012 will be less than1.5% vs near 3% at the moment. Rate cuts appear to be the only stimulus that will come over next few months produced by our central bank. Thankfully, RBI has a lot of room to cut rates…

But many argue that until inflation comes off significantly, its difficult for RBI to cut rates. We agree. But we find it difficult that inflation’s legs won’t break over next few months. Fundamentally, there are three key drivers of inflation, domestic demand, international commodity prices and domestic supply side. The most important driver, empirically, has been domestic demand which explains more than 60% of inflation moves in our country, is going to turn disinflationary. A growth of 6.5% in 2012, is 100-150 bps lower than our potential and this itself should break the legs of inflation. World growth for 2012 will be at least 100 bps lower than last decade’s average and that itself should be benign for international commodity prices. Even China, which has been the key driver of commodity demand is likely to slow down quite rapidly. China commodity consumption is likely to peak in this decade and more importantly, its likely to climb down secularly over next many years. We are still not sure of commodity prices coming down secularly, but we assign a good probability that 2011 saw peak commodity prices for next few years. The third driver of inflation, Indian production/supply side has been the most frustrating reason of inflation for all of us, as its reason lied in our poor planning and policy inertia.  Unfortunately, there is no great news on this front, as India remains supply constrained economy. The only silver lining is that capacity utilisation has come down by at least 7-8% over last 4-5 quarters in aggregate terms and that should bring down the pressure on inflation. Net, net all three drivers of inflation are likely to be either absent or less potent. So I believe, inflation would oscillate between 5.5-6.5 during 2012.

With low growth and low inflation, what does RBI do? It will cut rates and ease liquidity conditions. How will Gsec/Corp bonds behave? We predict:

• 1.       Corporate spreads for Good quality AAA bonds will narrow by 20-30 bps, falling to near 50 bps from current 80 bps.
• 2.       10 year Gsec will average at 8% through the year, but its likely to see some very low levels during the year (This one is the most difficult to predict, but may be closer to 7.5% during Q2/Q3 of the year, unfortunately it will not be permanent adobe for it given the state of our profligate government )
• 3.       1 year CD rates, which are currently trading at near 9.9% should get priced 100-125 bps lower over Q2/Q3 of 2012. Two or three year bonds too should get priced lower by 50-75 bps. Curve should bull steepen through 2012.

So what should you do? For those details get in touch with us over a personal meeting, phone call or email us. You can get in touch with us on 022-40156688/99 or dewang@denip.in / nimesh@denip.in.

Thanks,

Dewang K Mehta

DENIP Consultants Pvt. Ltd.

Rupee at 51: Will Asia’s worst currency continue falling?

What a volatile week it has been for the rupee. The partially convertible currency hit 51 against the dollar early on Friday, after closing at around 50.90 per dollar on Thursday.

It’s a 33-month low for the currency and the consensus is that the rupee will keep sliding for a while due to a combination of unfavourable global and local factors.

One of the most pessimistic predictions issued yesterday was by Laurence Balanco,technical analyst at CLSA. He told CNBC TV-18 the rupee could dive all the way to 58 against the dollar if it fell to the 52 mark.

While that might seem a little extreme, the fact is most experts believe the rupee’s slide is set to continue, at least in the medium term.

That the rupee is falling against the dollar is no surprise. Reuters

According to The Wall Street Journal, the Indian rupee is the world’s third-worst performing currency this year, falling by nearly 14 percent , next only to the Turkish lira, which is down 17 percent and the Kenyan shilling, which has lost 15 percent. It is also Asia’s worst-performing currency, the newspaper added.

What’s happening to the rupee?

The reasons for the rupee’s slide are not difficult to understand.

One, the never-ending sovereign debt travails of the eurozone continue to keep global investors on edge, who, as a result, continue to pull money out of relatively riskier emerging market assets and dive into safe havens like the US dollar. Indeed, some experts have said there is an increasing scarcity of dollars in the currency markets, given that everyone is scrambling to play it safe.

Two, a slowdown in the local economy, coupled with high inflation, is muting the prospects of corporate earnings, which is putting off foreign investors. Higher demand for local assets typically boosts demand for the local currency and thereby leads to the currency’s appreciation.

Foreign investors have only bought $663 million worth of Indian equities this year, sharply down from the $29 billion they invested in 2010, according to data from the Securities and Exchange Board. Not surprisingly, the benchmark Sensex is also down 20 percent this year. Capping the bad mood was Shankar Acharya, former chief economic advisor to the government, warned the economy could expand below 7 percent in the year ending March 2012. Other economists believe growth could be between 7-8 percent.

Three, India remains a net importer of foreign goods, and a third of that consists of oil imports. According to TV reports, oil companies import about $6 billion worth of crude every month.

A falling rupee will increase the cost of imports (in local currency terms), which increases the current account deficit, which is the trade deficit plus interest payments and other transfers. The trade deficit is the difference between exports and imports.

The current account deficit can be funded either through foreign direct investments or foreign portfolio investments (in equity/debt markets). But as we all know, foreign investments in local assets such as stocks have been low. Meanwhile, the current account gap continues to widen, which worries investors.

Four, with foreign currency reserves of $311 billion (at the end of September) and imports worth about $35 billion for the month, India now has the lowest import cover of 8-9 months. This is the lowest in the last decade, according to an opinion piece in Business Line. That worries investors because with the increasing cost of oil imports, there will be further demand for the dollar, which should drive down the value of the rupee further.

Five, hopes that the Reserve Bank of India (RBI) will intervene in the foreign exchange market to boost the rupee have dimmed after Deputy Governor Subir Gokarn said earlier this week that the central bank did not plan on changing its policy of intervening in foreign-exchange markets only in times of excessive volatility. That means investors can’t expect the RBI to swoop in and lift the rupee every time it hits a new low against the dollar.

All things considered, expect the rupee to keep going downhill for a while.

Source: Firstpost.com

Thanks,

Neha K. Mehta

DENIP Consultants Pvt. Ltd.

Happy Diwali and a Prosperous New Year

Dear All,

Here's wishing everyone a Very Happy Diwali and a Prosperous New Year!! May this Diwali bless with you with all the happiness in the world.

This last year has not been too kind for investors in the stock market but Gold and Fixed deposits along with FMPs has worked out just well. For the coming year following are some of the interesting bets:

1) Commodities to watch:

      a) Silver - Any downward movement in the equity market will directly lead Silver higher and I still believe that above 55K - 56K will take it to 65K - 70K which is a 25% - 30% rally.

      b) Gold - Best tool to fight against inflation and Equity market under-performance. I believe that at 26K - 27K Gold is still a buy but any rally to 32K - 35K should be used to book out profits in it. Again another 30% upside.

      c) Copper - If the equity markets do perform well this will be the commodity to watch out for. I believe that with a 2 year perspective investors should  slowly start accumulating this commodity.

      d) Sugar - This is a rather short term trading bet and I believe that It could soon see a 20% rally at the very least.

2) MF Investments:

I believe that all investors should get a SIP going with a 2 year perspective to earn an average of 20% - 30% rally. Following are the schemes that one can look at / diversify into:

      a) HDFC TOP 200
      b) HDFC Prudence
      c) DSP Top 100 Equity
      d) DSP World Gold Fund
      e) BSL Dividend Yield Plus
      f) BSL Tax Relief 96
      g) Reliance MIP
      h) Kotak Gold Fund

This portfolio should even be considered for any investors looking to invest over the next 20 years too.

3) Equity Market Investments:

I believe that this route of investments has under-performed since the past 1 year and will continue to do so over the next 2 quarters. However investors looking to put in money with a 2 year perspective could look at the following sectors / stocks:

      a) Cement Sector (ACC, Ambuja Cement, Ultratech Cement etc.)
      b) Auto Sector ( M&M, Tata Motors)
      c) Banking Sector (SBI, Yes Bank, ICICI Bank)
      d) Pharmaceutical Sector (Dr. Reddy, Lupin, Fortis, Cipla)
      e) Delta Corp
      f) Bajaj Financial Services

4) Real Estate Investments:

This could be one of the trickiest investments to make right now. I personally believe that this a sector one should avoid for any investments at least till the next few quarters. This sector could see a major dip in prices if sales drop.

5) Fixed Income Investments:

Over the next 3 quarters investors should look to exit from FMP / FDs and start moving to balanced funds / monthly income plans. Then look to shift to direct equity investments. One could even look at investing in to GILT Funds.

Once again wish you a very Happy Diwali and a prosperous new year!

Thanks,
Dewang K Mehta
DENIP Consultants

Nifty View- October 2011 - DENIP Consultants - Dewang K Mehta

Dear All,

We have been bearish on the Nifty since July 30th 2011 and we even booked profits once around the 4750 levels. At the current levels of 5118, and with today's red tick in the market we are bearish on the Nifty again with a target of 4750. 

Following is a zoomed out version of the Nifty chart which clearly shows that we are in a range bound zone in a falling trend market.

The following chart of the Nifty is the zoomed in version of the range bound trade. Next Target on the Nifty is 4750. We need to wait and watch if 4750 is breached this time or do we find support and continue this range bound trade.

Thanks,

Dewang K Mehta

DENIP Consultants

Disclaimer Post Applies

Recession / Great Depression and Opportunites to Invest - Dewang K Mehta

 The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s. It was the longest, most widespread, and deepest depression of the 20th century. In the 21st century, the Great Depression is commonly used as an example of how far the world's economy can decline. The depression originated in the U.S., starting with the fall in stock prices that began around September 4, 1929 and became worldwide news with the stock market crash of October 29, 1929 (known as Black Tuesday). From there, it quickly spread to almost every country in the world.

The Stock Market Crash in the US however was just the beginning. Since many banks had also invested large portions of their clients' savings in the stock market, these banks were forced to close when the stock market crashed. Seeing a few banks close caused another panic across the country. Afraid they would lose their own savings, people rushed to banks that were still open to withdraw their money. This massive withdrawal of cash caused additional banks to close. Since there was no way for a bank's clients to recover any of their savings once the bank had closed, those who didn't reach the bank in time also became bankrupt.

Businesses and industry were also affected. Having lost much of their own capital in either the Stock Market Crash or the bank closures, many businesses started cutting back their workers' hours or wages. In turn, consumers began to curb their spending, refraining from purchasing such things as luxury goods. This lack of consumer spending caused additional businesses to cut back wages or, more drastically, to lay off some of their workers. Some businesses couldn't stay open even with these cuts and soon closed their doors, leaving all their workers unemployed.

The Great Depression had devastating effects in virtually every country, rich and poor. Personal income, tax revenue, profits and prices dropped, while international trade plunged by more than 50%. Unemployment in the U.S. rose to 25% and in some countries rose as high as 33%. Cities all around the world were hit hard, especially those dependent on heavy industry. Construction was virtually halted in many countries. Farming and rural areas suffered as crop prices fell by approximately 60%. Facing plummeting demand with few alternate sources of jobs, areas dependent on primary sector industries such as cash cropping, mining and logging suffered the most. Some economies started to recover by the mid-1930s. However, in many countries the negative effects of the Great Depression lasted until the start of World War II.

The Great Depression of 1929 had a very severe impact on India, which was then under the rule of the British Raj. The Government of British India adopted a protective trade policy which, though beneficial to the United Kingdom, caused great damage to the Indian economy. During the period 1929–1937, exports and imports fell drastically crippling seaborne international trade. The railways and the agricultural sector were the most affected.

The international financial crisis combined with detrimental policies adopted by the Government of India resulted in the soaring prices of commodities. High prices along with the stringent taxes prevalent in British India had a dreadful impact on the common man. The discontent of farmers manifested itself in rebellions and riots. The Salt Satyagraha of 1930 was one of the measures undertaken as a response to heavy taxation during the Great Depression.

The Great Depression and the economic policies of the Government of British India worsened the already deteriorating Indo-British relations. When the first general elections were held according to the Government of India Act 1935, anti-British feelings resulted in the Indian National Congress winning in most provinces with a very high percentage of the vote share.

The Concept of Gold Standard

The gold standard is a monetary system in which the standard economic unit of account is a fixed mass of gold. There are distinct kinds of gold standard. First, the gold specie standard is a system in which the monetary unit is associated with circulating gold coins, or with the unit of value defined in terms of one particular circulating gold coin in conjunction with subsidiary coinage made from a lesser valuable metal.

Similarly, the gold exchange standard typically involves the circulation of only coins made of silver or other metals, but where the authorities guarantee a fixed exchange rate with another country that is on the gold standard. This creates a de facto gold standard, in that the value of the silver coins has a fixed external value in terms of gold that is independent of the inherent silver value. Finally, the gold bullion standard is a system in which gold coins do not circulate, but in which the authorities have agreed to sell gold bullion on demand at a fixed price in exchange for the circulating currency.

At the onset of the First World War, the cost of gold was very low and therefore the pound sterling had high value. But during the First World War, the value of the pound fell alarmingly due to rising war expenses. At the conclusion of the war, the value of the pound was only a fraction of what it used to be prior to the commencement of the war. It remained low until 1925, when the then Chancellor of the Exchequer (Finance Minister) of United Kingdom, Winston Churchill, restored it to pre-War levels. As a result, the price of gold fell rapidly. While the rest of Europe purchased large quantities of gold from the United Kingdom, there was little increase in the financial reserves. This dealt a blow to an already deteriorating economy. The United Kingdom began to look to its possessions as India to compensate for the gold that was sold.

What Did Smart Money Do In the 1929 Crash and Aftermath?

During the same bear market period smart-money moved from the plunging equity markets (i.e. financial assets) to hard asset investments, like Homestake Mining - which is used heretofore as a surrogate for all gold stocks.

The stock price of this gold mining company soared relentlessly upward during the entire bear market. Homestake Mining stock rose continuously from $80 in October 1929 to $495 per share in December 1935 - which represents a total return of 519% (excluding cash dividends) during the devastating bear market period.

Contemplate and appreciate the monumental difference in investment returns during a serious bear market. Smart-money invested $10,000 in Homestake Mining (hard assets) in late 1929 - which increased in value to almost $62,000 by December 1935. This represents a compound rate of return of 35% per year in appreciation alone!

It is meaningful to note that in late 1929 the value of Homestake Mining was about $80 per share. Moreover, during the next six years Homestake Mining paid out a total of $128 in cash dividends. In fact the 1935 dividend alone reached $56 per share. That's almost a 70% dividend yield payout (basis 1929) in only one year! Indeed, hard asset investments (gold mining shares) were islands of economic refuge during the grueling years of the Great Depression.

Unfortunately, those innocent souls who remained invested in stocks - and had a buy and hold strategy - saw their initial $10,000 investment slowly dwindle to only $3,600 by late 1935. This represented a devastating capital loss of almost two-thirds of their investment savings. The hapless naive investor with a buy and hold strategy in financial assets lost the greater part of his original stake. Pathetically, he could ill-afford to risk - let alone lose - his precious capital during the many long despairing years of the Great Depression.

One does not have to be a Ph.D. in higher mathematics to understand the 1929-1935 comparative investment results stated below.

Investment Vehicle	Investment Date	Amount	Investment Value @ Dec. 1935
DJIA	Oct - 1929	$10,000	$3,600
DJUA	Oct - 1929	$10,000	$2,100
Homestake Mining	Oct - 1929	$10,000	$62,000

Note: For simplification cash dividends not taken into account

What should an Ideal MF Portfolio look like over the next 2 years?

MF Scheme Name	Scheme Type	Investment Logic	Minimum Amount	% Allocation
DSP BR Top 100 Equity Reg – SIP (Growth)	Large Cap Fund	Safe bet in the Indian equities because of investments in blue chip companies	500 /-	10%
HDFC Top 200 Fund  - SIP(Growth)	Large Cap Fund	Safe bet in the Indian equities because of investments in blue chip companies	1,000 /-	20%
HDFC Prudence Fund – SIP	Balanced Fund	Balances the portfolio due to debt and large cap equity exposure	1,000 /-	20%
Birla Sunlife Dividend Yield Plus – SIP	Mid, Small & Micro Cap Fund	Risky bet but decent opportunity to accumulate midcap/small cap stocks at lower levels	1,000 /-	20%
DSP World Gold Fund – SIP	Gold Miners fund	Hedge to direct gold investments since if the US equities stabilize and gold falls a bit from here these companies will still earn higher margins	500 /-	10%
Kotak Gold Fund – SIP	Gold Fund	Direct gold investments as a total hedge to your equity investments	1,000 /-	20%
Total			Rs. 5,000 /-	100%

Thanks,

Dewang K. Mehta

DENIP Consultants Pvt. Ltd.

Disclaimer Post Applies

Bappa is at our office - Ganpati Bappa Morya

Dear All,

We at DENIP Consultants take immense pleasure in announcing that we've brought Bappa to our office. This morning at 7:30am which is a bit early for me (specially) and Nimesh, we brought Lord Ganesh to our office and just finished all the rituals.

As you can see in the picture above, we had to wear the Mahrashtrian Topis too :) ! Following are some of the snaps of Lord Ganesh at our office premise. 

We will keep posting more pictures as and when we can and we humbly request you to grace this occasion with your presence at our office space at the following address:

• DENIP Consultants, 13/A Kailash Plaza, Near Odeon Cinema, R N Narkar Road, Ghatkopar (E), Mumbai 400077

Thanks,

Dewang K Mehta

DENIP Consultants Pvt. Ltd.

What do you do with your SIP Investments when the Market is falling? - Dewang K Mehta

Dear All,

With a lot of you worried about your investments in the market, we at DENIP believe that in a falling market it’s better to have a SIP running rather than stopping with your investments just because the market is falling. Following is an example which should help you get an idea of what we’re talking about.

If you need any further details please feel free to call or email us.

Thanks,

Dewang K Mehta

DENIP Consultants Pvt. Ltd.

Disclaimer Post Applies

India Infoline Investment Services limited - NCD issue - 11.9% for 60Months

Dear All,

India infoline a reputed financial services company has come out with a NCD Issue dated August 4, 2011 to August 12, 2011.

Minimum application is of Rs. 5000 and following are the key details: 

Please click on the image to get a larger  view.

Thanks,
Dewang K. Mehta
DENIP Consultants
Disclaimer Post Applies

Core Projects & Technologies - Dewang K Mehta

Dear All,

Another stock which catches our attention is Core Projects and Technologies. This stock has been creating a rising/ascending triangle formation since 2009 which is denoted by the black lines. Although the break out from this pattern is yet to occur, if you look at the black highlights which are clearly the support zones for this stock, it would be prudent to buy this stock at the current 299 level.

Buy in small parts around the 299  - 275 level for a target of 317/330 over the next 6 months. I think that this stock has been creating a decent formation technically and if someone has a one year to two year time horizon this stock could possibly break out and reach very high targets.

I would like to buy it in parts right now for targets closer to 317. The potential breakout for this chart would happen above 350 levels but no harm in tracing it from now; could be one of the dark horses over the coming years.

Thanks,

Dewang K Mehta

DENIP Consultants

Disclaimer Post Applies

S&P CNX Nifty - Still Bearish - Dewang K Mehta

Dear All,

This week the S&P CNX Nifty closed at 5482 which according to the charts is a very crucial level for it. A close below 5480 will definitely see us testing the 5200ish zone on the Nifty which takes it lower by at least another 3%.

What we have done is to go back to the basics of technical analysis which talks about supports and resistances. We have highlighted the resistances in red color from where the Nifty has fallen every time and the supports in black which are the zones where Nifty witnesses buying and bounces back.

So according to our reading of the charts we are very crucially poised and if you play by the book then it’s prudent to buy the Nifty at 5480+ levels and keep a stop loss of 5446 both being spot figures. However for traders who love going short we would advocate a weekly close below 5450 to go ahead and short the Nifty.

We began July with the Nifty at 5700+ when we had emailed and blogged about being cautiously bearish and we still continue to hold a bearish view on the market. However we are not ruling out a ultra quick up move to 5650 if buying does come in.

Our previous posts on the Nifty:

1. April 2011 - http://denipconsultants.blogspot.com/2011/04/nifty-view-denip-consultants-dewang-k.html
2. June 2011 - http://denipconsultants.blogspot.com/2011/06/nifty-view-denip-consultants-dewang-k.html
3. July 2011 - http://denipconsultants.blogspot.com/2011/07/s-cnx-nifty-cautiously-bearish-dewang-k.html

Clearly the above posts show how we have been bearish on the Nifty since 5900 and continue to maintain our view.

Thanks,

Dewang K Mehta

DENIP Consultants

Disclaimer Post Applies

Weekly Market Outlook - 4th Week of July 2011 - Stock Picks - Dewang K Mehta

Dear All,

3 charts are attached herewith that we think have the best possible chart patterns for this week.  The stocks are:

1.       Adani Power

a.       This stock has broken out of its downward trading channels and now it could possibly begin an uptrend. We advise buying into this stock at levels of 111 for a target of 120.

b.      A close above 120 could also mean a beginning of a new uptrend which could take it to levels of 135 / 140.

2.       Amara Raja Batteries

a.       This stock which is trading at 249 levels could test the 300+ levels in the coming 6 months. However this could be a false break out and we would advise investors to wait for the next couple of days for a close above 250 to really see if the break out is true or false. If it does close above 250/255 then could test the 300 mark in the next few months.

3.       Jubilant Foodworks

a.       The stock seems to narrowing its channel and could soon witness a major break out. If there is an upside breakout then this stock which is trading at 893 could test 969 soon. However a downward breakout could take it to 800 levels. We think a possible upward break out is possible.

Thanks,

Dewang K Mehta

DENIP Consultants

Disclaimer Post Applies