Dated: 10/08/2024
Nifty did 24000 & beyond as earlier anticipated & fulfilled many long held bears on the backstage but it looks like bulls days are coming back as Nifty formed Doji on Weekly charts giving hope to so many adamant bulls on Dalaal Street. After all these volatilities faced during last week Nifty did what it always does, the liquidity driven rally once again stood tall & forced bears to leave the ground & gave a satisfactory closing though it was a mixed support from Bank Nifty & CNX IT followed by other large cap stocks but the support eventually worked.
The index shown weak beginning during the last week followed by follow on selling which lead the fear among trades / investors & with passage of every day every gap was beaten down but somehow managed to give satisfactory closing for the week giving hope to adamant bulls along its way. Nifty made low of 23893.70 but only once gave a single close below 24000 mark on daily charts which kept the hopes of revival alive & it did revived with weekly closing at 24367.50.
The Reserve Bank of India (RBI) conducted its Monetary Policy Committee (MPC) meeting on August 8, 2024, where it decided to keep the repo rate unchanged at 6.5%. This decision was expected due to stable inflation and strong economic growth. The RBI also maintained its stance on liquidity management, aiming to keep inflation within its target range while supporting economic growth.
The Securities and Exchange Board of India (SEBI) intensified its scrutiny of Asset Management Companies (AMCs) by enforcing stricter regulations against insider trading and market abuse. SEBI’s actions are expected to increase compliance costs and operational challenges for AMCs, particularly smaller firms, which may struggle with resource allocation and data security.
After the RBI monetary policy the India Vix begin to cool off significantly giving broader markets some stability & help them revive within the week itself.
The Federal Reserve held interest rates steady on its recent meeting but opened the door to reducing borrowing costs as soon as its next meeting in September as inflation continues coming into line with the U.S. central bank’s 2% target.
Meanwhile in “Nifty IT” our range of 38000-36000 tested & saw a significant shoot-up from that range & now it’s time for “Nifty IT” to outperform the broader markets once again & this time the upside potential in August series would be 43000 mark. However, we have already raised our positional target of 53000 in “Nifty IT” till March 2025 with volatilities in between the roads ahead & the second half of the 2024 is going to be of “Nifty IT” broadly. In the between the heavy weights like TCS Infosys & Wipro may continue to remain into focus.
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 Centre’s gross tax collections (post refunds but before transfers to states), stood at Rs 4.6 trillion in the first two-months of the current financial year, 15.9% higher than the year year-ago level, data released by the Controller General of Accounts (CGA) showed on Friday. This is against 10.6% annual growth pegged in the Budget for FY25.
Net tax revenue (after refunds and after devolution to states) during April-May, stood at Rs 3.19 trillion, accounting for 12% of the Budget estimate of Rs 26.02 trillion. However, during the same period of FY24, net tax revenue had accounted for about 16% of the Budget target.
Institutional players were net biased on each factors last week. When FII’s remained in net outflow of nearly Rs.19,139.76 cr. last week while DII’s continued to remain net buyer’s with net further inflow of Rs.20,871.10 cr.
Nifty last week another a breach in the 24000 border to give a low of 23893.70 but managed to give a decisive close above 24000 mark with closing at 24367.50 with net negative closing of 575.80 points i.e. down by -2.31% for the week. However, it managed to form a Doji on Weekly charts giving hope to the decisive bulls once again & everlasting liquidity driven move is likely to continue in the coming weeks as well. On the downside Nifty now has its crucial support range of 23890-24000 while the potential upside may last till 24700 kind of levels in the coming week ahead. However, the sector specific movement is highly likely to remain into the focus. On a specific sector remains sideways to highly bullish on Nifty IT (Bullish from 38000-36000 levels) with heavy weights like TCS Infosys & Wipro may continue to outperform the broader markets.
Sensex too made a low within our earlier specific range of 78000-79000 by making low of 78295.86 to give a close at 79705.91 with net negative closing by 1973.52 i.e. negative closing of almost 2.42% for the week. However, like Nifty the Sensex too made Doji on the Weekly charts & brought hope among adamant bulls for the coming week ahead. For the coming weeks the crucial support range now remain within the earlier defined range of 78000-79000 with potential upside of 80800-81200 can be expected in the coming week ahead. However, the sector specific movement is highly likely to remain into the focus. On a specific sector remain sideways to highly bullish on IT sector with certain dips in this market & heavy weights like TCS Infosys & Wipro may continue to outperform the broader markets.
Bank Nifty remained within our earlier mentioned levels. It may continue to show crucial support within the earlier defined range of 49600-50000 while on the upside 52500 remains an immediate target on breaching on the upper wall further target extension remains 54000-55000 kind of levels. Unlike last week where private heavy weights outperformed this week Nifty PSU Banks like SBI & Bank of Baroda are highly likely to outperform & certain mid-cap private sector banks like RBL Bank are likely to outperform the broader markets.
In Nifty Financial Services the crucial support now remains within earlier pre-defined range of 22500-22800 while the potential upside now remains at 23500-23650 kind of levels.
In “Nifty IT” the low’s of 38000-36000 has been tested & from there the heavy longs hopefully were created & is expected to hit 43000 mark in August series itself & positionally the estimated possible target of 53000 mark by the end of March 2025. In fact the upcoming second half of the FY 2024-25 would be completely of “Nifty IT” sector boosting heavy weights like TCS, Infosys & Wipro etc. We have now upgrading our positional target in Nifty IT towards 53000 magnificent mark by March 2025 any cool off towards 38000-36000 remains an opportunity to add long heavy longs. Stay bullish in this sector with any marginal dip in the heavy weight counter like 5-7% would be an excellent opportunity to add up the longs.
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: 24367.50
Nifty Immediate Target: 24700
Nifty Immediate Support: 23890-24000
Sensex CMP: 79705.91
Sensex Immediate Target: 80800-81200
Sensex Immediate Support: 8000-79000
Bank Nifty CMP: 50484.50
Bank Nifty Immediate Hurdle / Target: 52500 / 54000-55000 (As the case may be)
Bank Nifty Immediate Support: 49600-50000
Nifty Financial CMP: 22983.30
Nifty Financial Crucial Target: 23500-23650
Nifty Financial Crucial Support: 22500-22800
Nifty IT CMP: 39043.30
Nifty IT Potential Upside: 43000 / 53000 (As the case may be)
Nifty IT Crucial Supports: 38000 -36000
Stock on Radar:
Large Caps:
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Ola Electric Mobility (CMP 91): This newly listed mid-cap auto counter is above 20% from its IPO price of 76 currently trading at 91.20. Looks like some 25-30% up move is inevitable from here onwards. One can accumulate here at CMP 91.20 with strict SL placed at 80 for an estimated possible upside of 115-120 i.e. 25-30% potential upside from CMP.
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Aditya Birla Capital (CMP 212): This large-cap NBFC counter is peer to Jio-financials & has last week posted fantabulous results from there some profit booking was seen lately. It looks like dusts have been settled down & some cheer could come up. So one can accumulate here at CMP 212 with SL placed at 190 for an estimated potential upside of 270 in 3 months time frame.
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Nykaa (CMP 192): A large-cap into e-commerce section is all you need into glooming startups. This looks like on the verge of a possible breakout & looks good to add here at CMP 192 with strict SL placed at 160 for an estimated possible potential upside of 321 in a year time frame.
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SBI (CMP 824): Last week we were short on SBI & it did exactly what we predicted now it seems to be bottoming out & do some wonders from here onwards. One can accumulate here at CMP 824 with SL placed at 800 one can expect a potential upside of 900 in 2 weeks time frame.
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Bank of Baroda (CMP 245): Another PSU bank counter where we predicted exactly what happened in the last week & now is on a potential upside from CMP 245 with strict SL placed at 230 for a potential upside of 280 in 2 week’s time frame.
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Jio Financials (CMP 326): This large-cap counter has been on our radar since subdued levels of 320 & still can be added here at CMP 326 with strict SL placed at 300 one can expect possible target of 420 in August series itself.
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Wipro (CMP 492): This IT giant has been on our radar since 445 levels from there it has already tested 575 & shown some correction lately due to results effect. This counter still looks hot to add here at 492 with strict SL placed at 470 for an estimated possible target of 550-575.
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Titan (CMP 3332): Titan has been on our radar since subdued 3200 levels & did wonders from there. It finally now looks an attractive pick once again from CMP 3332 with SL placed at 3000 it has a potential upside of 3600-3800 till upcoming Diwali 2024.
Mid- Caps:
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Zee Entertainment (CMP 137): This media entertainment company is purely based on technical outlook with medium term potential upside towards 200 from CMP 137 with strict SL placed at 120.
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Campus Activewear (CMP 293): This mid-cap footwear stock has been on our radar since subdued 223 levels but still looks attractive to buy at CMP 293 for an estimated possible target of 366-420 with strict SL placed at 260 within 3 months time frame.
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Anupam Rasayan (CMP 779): This mid-cap specialit chemical counter has been on our radar since subdued levels of 779 one can still add it here 790 with strict SL placed at 700 for an estimated possible target of 970-1200 within next 6 months time frame.
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KRBL (CMP 284): This rice sector giant has been on radar from 268 levels. This still looks attractive at CMP 184 with strict SL placed at 270 one can expect an upside potential of 427 in 3 months time frame.
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RBL Bank (CMP 217): This mid-cap banking counter has been on correction mode lately but posted excellent results. This looks attractive at here CMP 217 with strict SL placed at 200 for an estimated possible target of 270-320 in 6 months time frame.
Small / Micro Caps:
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K&R Rail Engineering Ltd. (CMP 467): This small cap counter has shown strength despite volatility in the global markets. This counter looks hot to add here at CMP 467 with strict SL placed at 430 for an estimated possible target of 575 in this month itself.
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Anmol India (CMP 32): This micro cap counter looks good to accumulate here at CMP 32 with strict SL placed at 30 one can expect an upside potential towards 40-41 in no time.
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 12+ 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.
Email I’d: contact@vgstockresearch.com
Contact: +91-9953934544
Website: https://vgstockresearch.com/
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