Dated: 22/06/2024
As earlier anticipated last week Nifty remained dull during the whole week despite hitting ATH several times. It is highly likely to face its immediate hurdle at 23700 levels. The last week of the month may continue to exert pressure as upcoming Budget event may create panic / pressure on likely insertion of incremental tax on derivatives segment.
After the election event has been closed Nifty remained dull throughout the last week though Nifty has been making new high’s but failed to sustained the high’s & the dull performance throughout the week was seen on Dalaal Street. Sector specific performance was seen & aggressive sector rotations were seen.
The so called “Bull Masala” is likely to be snatched off from the broader markets & Dalaal Street is highly likely to starve out of this “Bull Masala” as nervousness could possibly hit due to rumors of incremental taxation in the derivatives segment to 30% & to income to be treated as lottery income.
Nifty last week formed Doji on weekly charts which denotes indecisiveness of the move. If in the coming week 23700 remains safe on the upside we could possibly get to see some pressure building up & a downside is possible towards desired levels of 23100-22800 range levels. More over the broader range lies in between the dullness to some weakness which is likely to happen in the last week of June series.
After the India Vix from 9.85 tested 31.710 & then eventually cooled off towards 11.63 completing our target range of 13-14 now it is trading at 13.18. It is highly likely to rise once again till the upcoming Budget in July series towards the broader levels of 18-20 & volatility once again to hit the Dalaal Street.
Meanwhile the safe heavens are likely to remain within “Nifty IT” & Nifty FMCG” sectors. We have been continuously bullish on “Nifty IT” with continues support within the pre-defined range of 31200-32900 while immediate support now lies at 34000 levels one can expect it to hit 38000 mark sooner or later. On the other hand “Nifty FMCG” has its crucial support at 55000 levels from there one can expect it to test 60000 mark in the next 3 months time frame.
The GST data shows positive development in the Indian economy on the domestic levels. As this time India has for the first time tested a magnificent level of GST collection of Rs.2, 10,267 cr. in the month of April 2024 as compared to its YoY collection of April 2023 as Rs. 1,87,000 cr. & in the month of May the GST collection was Rs.1,72,739 showing 10% growth on YoY basis. It indicates an impressive 10% Y-o-Y growth compared to last year. Top States contributing:
- Maharashtra- 26,854 crore
- Karnataka- 11,889 crore
- Gujarat- 11,325 crore
The Indian government’s direct tax collection increased by 20.99% YoY to ₹4.62 lakh crore from April 1 June 17, boosted by a 27.34% increase in advance tax collection. The gross direct tax collection was ₹5.15 lakh crore, up 22.19% from the previous year. The income tax department issued refunds totaling ₹53,322 crore, 33.70% higher than the previous year.
Advance tax collection in FY till June 15 surged 27.6% to ₹1.48 lakh crore, with ₹1.14 lakh crore as corporate tax and ₹34,362 crore as personal income tax, indicating a strong economy and corporate performance.
The Department for Promotion of Industry and Internal Trade (DPIIT) in India is planning to focus on easing early-stage funding for startups, reducing compliance burdens, and reducing logistics costs as part of its 100-day action plan. The plan includes a policy for deep-tech startups, reforms for ease of doing business, and a public-private partnership model of governance.
Another factor to be considered the FII’s so far in the second week of the June series from being net buyer’s now eventually turned negative Rs. 2,584.72 cr. while DII’s continued to remain net buyer’s with stocks buying worth Rs.21,447.02 cr.. Meanwhile in the month of May FII were net negative with Rs. 42,214.28 cr. while DII’s were net buyers with net buying of Rs.55,733.04 cr.
Nifty last week remained dull as earlier anticipated. It made high of 23667.10 to give a close at 23501.10 with net nominal gain of 35.50 points i.e. 0.15% for the week. Though we are moving into the last week of the June series India Vix is once again expected to hit within the defined range of 18-20 till the upcoming Budget in July while lower levels of 11 remains a good support here. The higher volatility is expected to remain on Dalaal Street. In the coming week ahead Nifty is likely to face immediate hurdle at 23700 & if it remains safe & doesn’t get breached on closing basis we could possibly get to see the lower range levels of 23100-22800 range. However, the focus for safe shall be on Nifty FMCG & Nifty IT which could be considered as safe heaven & highly bullish sectors as of now.
Sensex also last week remained dull throughout the week despite hitting ATH several times. It made high of 77851.63 to give a close at 77209.90 up 217.13 points i.e. 0.28% for the week. As earlier mentioned we are moving into the last week of the June series India Vix is once again expected to hit within the defined range of 18-20 till the upcoming Budget in July while lower levels of 11 remains a good support here. The higher volatility is expected to remain on Dalaal Street. In the higher volatility Sensex is likely to face hurdle at 78000 mark while in case of a correction the immediate downside target now remains at 75400-75000 levels respectively. However, the focus for safe shall be on Nifty FMCG & Nifty IT which could be considered as safe heaven & highly bullish sectors as of now.
Bank Nifty last week has completed almost our target of 52000 after hitting the ATH levels of 51957 to give a close at 51661.45. It is now highly likely to face its immediate hurdle within the defined range of 52000-52359 while a sideways move could be seen in the sector in the last week of June series however in case of any imminent cool off the immediate target remains at 49900 kind of levels.
In Nifty Financial Services also we have almost achieved all our target levels of 23000-23200 after hitting ATH of 23154.25. In the coming week ahead it is highly likely to face its immediate hurdle at 23000-23560 range while immediate downside in case of any imminent cool off we could get 22000-21900 kind of levels. However, broader movement may remain dull throughout the coming week ahead.
In Nifty IT sector we continue to remain highly bullish while immediate support range now lies at 34000 while positional crucial support still remains within the pre-defined range of 31200-32900 while immediate positional target continues to remain at 38000 & 40000 respectively. In fact this whole coming FY 2024-25 may remain bullish for this entire sector. Moreover these dips remain an excellent opportunity to add longs into quality heavy weight IT stocks mainly; Infosys, TCS, Wipro etc.
Till March 2024 the number of Demat Accounts has risen to whopping 14.39cr. which not only helps the capital markets directly but also directly to Equity investments.
In the FY 2023-24 so far the Direct Tax collection has amounting to whopping Rs. 18, 90,259 cr. has seen the surge of nearly 19.88% as compared to its previous year collection of Rs. 15,76,776 cr. .
Brief Levels of Nifty / Sensex/ Bank Nifty / Nifty Financials / Nifty IT:
Nifty CMP: 23501.10
Nifty Crucial Hurdle: 23700
Nifty Crucial Support: 23100-22800
SENSEX CMP: 77209.90
Sensex Crucial Hurdle: 78000
Sensex Crucial Support: 75400-75000
Bank Nifty CMP: 51661.45
Bank Nifty Crucial Hurdle: 52000-52359
Bank Nifty Crucial Support: 49900
Nifty Financial CMP: 22991.55
Nifty Financial Crucial Hurdle: 23000-23200
Nifty Financial Crucial Support: 22000-21900
Nifty IT CMP: 35200.30
Nifty IT Potential Upside: 38000 / 40000 (As the case may be)
Nifty IT Crucial Supports: 34000 / 31200-32900 (As the case may be)
Stock on Radar:
Large Caps:
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AU Small Finance Bank (CMP 668): This small finance bank is no more a small bank. Can give a small run-up & looks good to accumulate on minor dip towards 658-650 with strict SL placed at 625 one can have an estimated possible target of 730 in 2months time frame.
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Coromandel International (CMP 1550): This counter faced some pressure last week. Looks good to short here at CMP 1550 with strict SL placed at 1650 one can expect an immediate downside target of 1400.
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Voltas (CMP 1488): Though this counter always remain on limelight in the summer since Monsoon is about to come some coll off could be seen in this counter from here CMP 1448-1449 one can keep strict SL placed at 1552 for an estimated possible target of 1300.
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Mphasis (CMP 2430): This IT giant looks like can continue its run-up with Nifty IT sector broadly being bullish. One can accumulate here at CMP 2430 with strict SL placed at 2187 for an estimated possible target of 2700-2800 till coming December 2024.
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Jio Financials (CMP 361): This large-cap counter has been on our radar since subdued levels of 320 & still can be added here at CMP 361 with strict SL placed at 300 one can expect possible target of 420 in July series.
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Infosys (CMP 1530): This large cap IT counter has been on our radar since subded levels of 1400 & still looks hot at CMP 1530 & has shown some sharp pull back lately with Nifty IT being bullish now this heavy weight giant of IT sector looks good to accumulate here at CMP 1489 with strict SL placed at 1300 for an estimated possible target of 1700-1850 within next 4-6 months time frame.
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Wipro (CMP 491): Another large-cap IT counter which has been on our radar since subdued levels of 439 & still looks like available on attractive price at CMP 491 & can be added on dips towards 430 with strict SL placed at 400 expect a price target of 540-620 within 6 months time frame.
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TCS (CMP 3811): This large cap IT counter has been on our radar since subdued levels of 3670 & still looks good to accumulate here at CMP 3811 with SL placed at 3400 for an estimated possible target of 4200 in June series.
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Adani Enterprises (CMP 3189): As the BJP is coming back Adani stocks once again can reclaim the glory so one can add here at CMP 3189 with strict SL placed at 2850 one can expect it to re test the high’s of 3800-4000 in no time.
Mid- Caps:
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JK Tyre (CMP 397): This mid-cap auto-ancilliary counter looks like can form some short term bottom here somewhere at 397 with strict SL placed 354 one can look for a possible target of 447-480 in 4 mths time frame.
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Indiabulls Realestate (CMP 156.50): This counter has seen surge lately but is on monthly long term resistance levels & a pull back is imminent. If 167 remain safe on closing basis one can expect a cool off towards 126-136 kind of levels.
Small / Micro Caps:
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Monte Carlo Fashion (CMP 596): This micro-cap counter looks good to accumulate here at CMP 596 with strict SL placed at 500 one can expect it to rise towards 1000 in this FY itself.
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Shahlon Silk (CMP 21.66): This micro cap counter looks good for a short term reversal here at CMP 21.66 with SL placed at 19 one can go long for 30-31 kind of levels as immediate targets.
About the Author:
Mr. Vishal Gupta a SEBI Registered Research Analyst is the founder of “VG STOCK RESEARCH”, founder of “THE ANALYSIS ROOM”, a writer & an advisor having rich experience in Indian Equity Markets who has spent years comprehending an industry wide shift and risk management with more than 9+ years exploring in depth analysis of the Equity & Derivatives with accuracy of 90% and above.
He has also been into teaching Fundamental Analysis for quite some time giving investors/traders comprehensive knowledge & skills of Indian Equity Markets.
He has recently been recognized by “Silicon India Magazine” as “INDIA’S TOP 10 MOST PROMISING STOCK ADVIOSY SERIVCE PROVIDERS OF 2024”
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