May 2021 | Page 2 of 17 | MarketSmith India Blog

May 28, 2021May 28, 2021

SGX Nifty Indicates Higher Opening; Action Construction Equipment and IPCA Labs to Report Results Today

At 8:00 am IST, SGX Nifty Futures was trading at 15,460, compared with Nifty close of 15,338 yesterday.

Global stock markets: Dow30, +0.4%; S&P 500, +0.1%; Nasdaq, -0.01%; Kospi, +0.7%; Nikkei, +2%; Shanghai Composite, -0.1%

Yesterday, Nifty opened muted but gained strength during the session and moved above 15,350. The volatility was high due to monthly F&O expiry. After moving to and fro, Nifty closed 0.2% higher. Volume was comparatively high. Nifty is now less than 100 points below its all-time high. Broader market indices outperformed benchmark indices. Barring Nifty Realty (-1.2%) and Pharma (-0.2%), all other sectoral indices closed in the green. Nifty PSU Bank closed 2.8% higher. Nifty IT (1.2%) continues positive momentum after leading stocks like TCS and Infosys reclaimed their 50-DMA yesterday. The advance-decline ratio was in favor of advancers. Of the 2,259 stocks traded, 1,024 advanced, 893 declined, and the rest remained unchanged. Nifty is trading 3% and 4% above its 21- and 50-DMA, respectively.

Last week, Nifty retook its 50-DMA, did not add a distribution day, and registered an additional follow-through day, which are positive signs. We would like the index to hold its 50-DMA and trade above that. Without trying to predict and decode stories, we will take what the market gives and continue to monitor unfolding conditions. If the index falls further, adds a distribution day, and breaches its key moving averages, we may change the market status to an Uptrend Under Pressure. Focus on quality ideas emerging out of sound bases with relative strength line at or near new highs while reducing exposure to stocks breaking below key support levels.

Key Results Today: Action construction Equ, Nesco, Ipca Laboratories (Nse), Deepak Fert & Petrochem, and others.

Key News:

Sun Pharm Industries reported its Q4 FY21 results. Revenue was up 4.1% y/y to Rs 8,523 crore. PAT surged more than 2x to Rs 894.1 crore.

Metropolis Healthcare reported its Q4 FY21 results. Revenue was up 40.9% y/y to Rs 291.7 crore. PAT surged almost 4x to Rs 61.3 crore.

Eicher Motors reported its Q4 FY21 results. Revenue was up 33.2% y/y to Rs 2,940.33 crore. PAT advanced 60.9% y/y to Rs 526.1 crore.

Buy Watchlist: Page Industries, Action Construction Equ., State Bank Of India, Ambuja Cements, Eveready Inds.(India), Varun Beverages, Colgate-Palmolive India, Sharda Cropchem, Astral, I G Petrochemicals, Berger Paints India, Icici Bank, Ramkrishna Forgings, Gujarat State Petronet, Apollo Hosps.Enterprise, and Apollo Tricoat Tubes

Recent Articles :

Is Sonata Software a Long Term Leader A Good Buy

Sterlite Technologies; Watch Out For This Computer Network Co As it Races North On Heavy Volume

May 27, 2021May 27, 2021

Nifty’s Winning Streak Continues for Fifth Straight Day; PSU Bank and IT Stocks Outperform

Today’s Action

Nifty, +0.2%; Sensex, +0.2%; Nifty Midcap, +0.5%; Nifty Smallcap, +1%; Model Portfolio, +0.8%

Market Pulse: Confirmed Uptrend

Distribution Day Count: Three

Nifty after a muted opening, gained strength and moved above 15,350. The volatility was high due to monthly F&O expiry. After moving to and fro, Nifty closed 0.2% higher. Volume was comparatively high. Nifty is now less than 100 points below its all-time high. Broader market indices outperformed benchmark indices. Barring Nifty Realty (-1.2%) and Pharma (-0.2%), all other sectoral indices closed in the green. Nifty PSU Bank closed 2.8% higher. Nifty IT (1.2%) continues positive momentum after leading stocks like TCS and Infosys reclaimed its 50-DMA yesterday. The advance-decline ratio was in favor of advancers. Of the 2,259 stocks traded, 1,024 advanced, 893 declined, and the rest remained unchanged. Nifty is trading 3% and 4% above its 21- and 50-DMA, respectively.

Last week, Nifty registered an additional follow-through day and hasn’t added any distribution day after May 11. These are positive signs for a sustainable rally. We would like the index to hold its 50-DMA and trade above that. Without trying to predict and decode stories, we will take what the market gives and continue to monitor unfolding conditions. If the index falls further, adds a distribution day, and breaches its key moving averages, we may change the market status to an Uptend Under Pressure. Focus on quality ideas emerging out of sound bases with RS line at or near new highs while reducing exposure to stocks breaking below key support levels.

Key News

Alkyl Amines Chemicals’s Q4 FY21 revenue grew 62.8% y/y to Rs 382 crore. PAT up 88% y/y to Rs 92.6 crore. Margin expanded 640bps to 34.9%.

Cadila Healthcare announced its Q4 FY21 results. Revenue came in line with estimates, while PAT and margin beat estimates. Revenue grew 2.5% y/y to Rs 3,846 crore. PAT grew 73.6% y/y to Rs 649 crore. Margin expanded 110bps to 22.2%.

Page Industries’s Q4 FY21 revenue grew 63% y/y to Rs 881 crore. PAT came in at Rs 115.6 crore compared with Rs 31 crore in Q4 FY20. Margin expanded 860bps to 19.3%.

Recent Articles:

Portfolio Closes 0.8% Higher Against Nifty’s Gain of 0.2%

Sterlite Technologies; Watch Out For This Computer Network Co As it Races North On Heavy Volume.

Is Sonata Software a Long Term Leader A Good Buy

May 27, 2021May 28, 2021

Is Sonata Software a Long Term Leader A Good Buy

Sonata Software stock is worth watching as the stock is forming a 6-week, 13% deep Flat Base. The current price is only 5% away from its ideal buy price of INR 634. Aggressive investors could use any tight area breakout inside the base as an opportunity to initiate a small position. A conservative approach may be to add the stock to your watchlist so that you are ready to pounce if it breaks out to the traditional entry point.

The key trend lines, 10 and 40-week moving averages are at a comfortable position. The current trends of both the averages are upward and the 10-week moving average is trending above the 40-week moving average. The current price of the stock is trading around 15.55% away from the 10-week moving average.

In the last twelve months, Sonata Software has rallied nearly 189.4% as compared to 59.6% for the Nifty500. It has a Relative Strength Rating of 84. We definitely would like see improvement in the rating. At this point we are taking a step back and focusing on the RS Line.

The Relative Strength Line of the stock is offering a lot of encouragement to investors. It has been making good progress in the last few weeks. The overall long term trend of the line is also trending upward. If Sonata Software can maintain this outperformance, it could make sense as a CANSLIM trade.

Another key part of the jigsaw is institutional sponsorship. Sonata Software has an Accumulation/Distribution Rating of ‘A’. This represents heavy institutional buying over the past few weeks. The number of institutional sponsors and shares held by the sponsors, both increased in the last reported quarter.

On the earnings front, Sonata Software has an excellent EPS Rank of 80, which indicates consistency in earnings. The earnings and sales for the stock have grown by 7% and 22%, respectively over the past three years. Its 3-years earnings stability is 10, on a 0 to 99 scale (lower the better). Over the past five years, the earnings and sales for the stock have grown by 13% and 17%, respectively. The 5-years earnings stability is 10. The return on equity for the last reported year is 31%.

The stock belongs to industry group of Computer-Tech Services. You would still want to see some improvement in the industry group rank for the group. The current industry group rank is 75. The current price of Sonata Software is 2% off from its 52-week high price and 241% above it 52-week low price.

The stock appears on our idea lists: Trend Template – 5 Months.

Recent Article:

Sterlite Technologies; Watch Out For This Computer Network Co As it Races North On Heavy Volume.

May 27, 2021May 27, 2021

Sterlite Technologies; Watch Out For This Computer Network Co As it Races North On Heavy Volume.

Sterlite Technologies stock has broken out of a 14-week, 28% deep Ascending Base 4-weeks ago. However, the stock is still worth watching as the current price is only 8% away from the ideal buy price of INR 238.

In the last twelve months, Sterlite Technologies has rallied nearly 151.1% as compared to 59.6% for the Nifty500. It has a Relative Strength Rating of 67. We definitely would like see improvement in the rating. At this point we are taking a step back and focusing on the RS Line.

The Relative Strength Line of the stock is offering a lot of encouragement to investors. It has been making good progress in the last four weeks. The overall long term trend of the line is also trending upward. If Sterlite Technologies can maintain this outperformance, it could make sense as a CANSLIM trade.

Another key part of the jigsaw is institutional sponsorship. Sterlite Technologies has an Accumulation/Distribution Rating of ‘B+’. This represents heavy institutional buying over the past few weeks. The number of institutional sponsors and shares held by the sponsors, both increased in the last reported quarter.

On the earnings front, Sterlite Technologies has an excellent EPS Rank of 89, which indicates consistency in earnings. The sales for the stock have grown by 12% over the past three years; however the earnings growth remained muted at -19%. Its 3-years earnings stability is 34, on a 0 to 99 scale (lower the better). Over the past five years, the earnings and sales for the stock have grown by 16% and 23%, respectively. The 5-years earnings stability is 46. The return on equity for the last reported year is 14%.

The current price of Sterlite Technologies is -1% off from its 52-week high price and 178% above it 52-week low price. The stock belongs to industry group of Computer-Networking, which is exhibiting excellent strength in the current market environment. The current industry group rank is 19.

The stock appears on our idea lists: Trend Template – 5 Months.

Recent Articles :

Godrej Industries Stock Is Marching Towards 52-Week High

May 27, 2021May 27, 2021

BPCL Q4 Bottomline Beats Consensus; Dixon Technologies and Sun Pharma to Report Results Today

At 8:00 am IST, SGX Nifty Futures was trading at 15,342, compared with Nifty close of 15,302 yesterday.

Market Pulse: Confirmed Uptrend

Distribution Day Count: Three

Global stock markets: Dow30, +0.03%; S&P 500, +0.2%; Nasdaq, +0.6%; Kospi, -0.7%; Nikkei, -0.7%; Shanghai Composite, +0.1%

Yesterday, Nifty gapped higher but remained volatile in the opening hour. It gradually moved higher as the day progressed and closed above 15,300. Volume was comparatively low. Nifty is now less than 1% below its all-time high. Sensex also crossed the 51,000 mark and closed above that. Broader market indices underperformed benchmark indices. Barring Nifty Metal (-1.8%) and PSU Bank (-0.3%), all other sectoral indices closed in the green. Nifty Realty closed 2.8% higher. After many days of muted action, Nifty IT (1.8%) led the gains today. Nifty Auto, FMCG, Pharma, and Financial Service closed 0.1–0.5% higher. Nifty is trading 3% and 3.8% above its 21- and 50-DMA, respectively.

Key Results Today: Dixon Technologies (India) , Sun Pharm.Industries , Cadila Healthcare, Alkyl Amines Chemicals, and others.

Key News:

Bharat Petroleum reported its Q4 FY21 results. Revenue was up 15.2% q/q to Rs 76,882 crore. Margins improved to 6.6%. PAT surged almost 4x to Rs 11,940.1 crore. Bottomline beats consensus.

Tata Consultancy Svs made a partnership with LACChain to develop a blockchain ecosystem in Latin America and the Caribbean.

Cummins India (Nse) reported its Q4 FY21 results. Revenue was up 18.2% y/y to Rs 1,256.25 crore. PAT stood almost flat at Rs 168.6 crore.

Stocks on the move on 26.05.2021

Up in price:

Down in price