Gladiator Stocks Scrip I-Direct Code Action Target Stoploss Federal-Mogul Goetze (India) Ltd. FEDGOE Buy in the range of 540-560 680.00 480.00 Time Frame: 6 Months Research Analysts Dharmesh Shah dharmesh.shah@icicisecurities.com Pabitro Mukherjee pabitro.mukherjee@icicisecurities.com Nitin Kunte, CMT nitin.kunte@icicisecurities.com com Vinayak Parmar vinayak.parmar@icicisecurities.com com Dipesh Dagha dipesh.dagha@icicisecurities.com March 31, 2017
Federal-Mogul Goetze (India) (FEDGOE): Consolidation above multi-year breakout area... CMP: 560.00 00 Buying Range: 540-560 560 Target: 680.0000 Stop loss: 480.00 00 Upside: 24% Stock Data 52 Week High / Low 594/305.2 50 days EMA 497 200 days EMA 460 52 Week EMA 452 Face Value ( ) 10 Market Capitallisation ( Cr.) 3104 *Recommendation given on i-click to gain on March 31 2017 at 14:12hrs Stock price vs. BSE 500 600 550 500 450 400 350 300 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Federal Mogul BSE500 13,000 12,500 12,000 11,500 11,000 10,500 10,000 Price performance in last five years 140% 40% -60% 0% -6% 108% -12% 37% 2012 2013 2014 2015 2016 Year Source: Bloomberg, BSE, ICICIdirect.com Research Key technical observations The share price of Federal-Mogul Goetze got catapulted past its major multi-year peaks of 450 in September 2016 backed by strong participation to signal a larger degree bullish structural turnaround. After the major breakout rally, the share price moved into a sideways consolidation phase and marked time between the broad range of 540 to 450 levelsl overthe last six months. We believe the six month consolidation i above the multi-year li breakout levell of 450 has laid the foundation for the next major up move going forward and the stock provides a good investment opportunity from a medium term horizon Change of Polarity: Multi-year breakout level acts as major base... The major yearly peaks of 2007, 2014 and 2015 for the stock were placed around 450 region. The strong resolution past the multi-year peaks signalled a major shift of momentum in favour of the bulls and opened bullish implications for the stock from a long term horizon. The stock has displayed classic attributes of change of polarity as the previous major hurdle of 450 reversed its role and acted as the base for the last six months consolidation between October 2016 to March 2017. The sideways consolidation over the last six months highlights accumulation by stronger hands above the major breakout area ahead of the next leg of up move going forward Breakout from six months consolidation... The strong up move in this week has seen the stock register a breakout past the preceding six months consolidation range of 450 to 540 levels thereby signalling resumption of the upward momentum after forming a higher base abovepreviousmulti-yearpeaks.webelievethestockissettotakeoff from hereon and head towards our target of 680 over the medium term horizon and offers good investment opportunity. We believe the monthly low of March 2017 placed around 480 region will act as immediate support for the stock going forward. Volume expansion at breakout area... The price breakout above multi-year peak in September 2016 was accompanied with strong weekly volume of 11.8 lakh shares while the current breakout from six months consolidation has also seen weekly volumes (2.2 lakh shares) of more than twice the 52 week average volume of less than 1 lakh shares per week. Volumes rising in the direction of primary trend highlight inherent strength in the trend and positive bias for the medium term Momentum oscillators indicate build-up of positive momentum Among oscillators, the monthly MACD (E-12,26,9) is in rising trajectory and is seen diverging from its nine-period average indicating strong momentum in the underlying trend and augurs well for continuance of the up move Conclusion Based on the aforementioned observations, we expect the stock to enter into asustainable uptrend and head towards target of 680 in the medium term. The price wise equality with last rising segment ( 310 to 545=235 points) measured from recent higher bottom of 447 projects upside towards 680 region over medium term. 2
Federal-Mogul Goetze (India) (FEDGOE): Monthly Bar Chart Breakout from six month consolidation above previous multi-year peaks provides platform for the next major up move going forward Pi Price equality with preceding up move @ 680 545 450 447 310 Strong volumes accompanying the breakout highlight larger participation in the direction of primary trend Monthly MACD diverging from its 9 period average indicating bullish momentum Source: Bloomberg, ICICIdirect.com Research 3
Strategy Follow up Open Recommendations: Date Scrip Name Rec Price Target Stoploss CMP Return till date (%) 28-Feb-17 Kajaria Ceramics 578 679 523 586 1.4% 14-Mar-17 17 Titan 453 548 398 460 15% 1.5% 15-Mar-17 Kansai Nerolac 360 425 326 376 4.4% 17-Mar-17 Dabur 273 318 248 277 1.5% 20-Mar-17 IDBI 75 98 66 75 0.0% 23-Mar-17 GMDC 121 154 102 124 2.5% 28-Mar-17 Sun TV Network 780 920 715 794 1.8% 30-Mar-17 Ingersol Rand 750 920 685 768 24% 2.4% 30-Mar-17 KSB Pump 671 784 595 708 5.5% Summary Performance - Recommendations till date Open Recommendations 9 Total Recommendations 133 Yield on Positive recommendations 19.0% Closed Recommendations 124 Yield on Negative recommendations -8.0% Positive Recommendations 89 Strike Rate 72% 4
Notes It is recommended to enter in a staggered manner within the prescribed range provided in the report Once the recommendation is executed, it is advisable to keep strict stop loss as provided in the report on closing basis. The recommendations are valid for six months and in case we intend to carry forward the position, it will be communicated through separate mail. Trading portfolio allocation It is recommended to spread out the trading corpus in a proportionate manner between the various technical research products Please avoid allocating the entire e trading corpus to a single stock or a single product segment Within each product segment it is advisable to allocate equal amount to each recommendation For example: The Daily Dil Calls Cll product carries 3 to 4 intraday recommendations. It is advisable to allocate equal amount to each recommendation 5
Recommended product wise trading portfolio allocation Product Allocations Product wise Max allocation in allocation 1 Stock Number of Calls Return Objective Frontline Stocks Mid Cap Stocks Duration Daily Calls 8% 2-3% 3-4 Stocks 0.5-1% 2-3% Intraday Stocks on the Move 6% 3-5% 7-10 Per Months 7-10% 10-15% 3 Months Weekly Calls 8% 3-5% 1-2 Stocks 5-7% 7-10% 1 Week Weekly Technicals 8% 3-5% 1-2 Stocks 5-7% 7-10% 1 Week Monthly Call 15% 5% 2-3 Stocks 7-10% 10-15% 1 Month Monthly Technical 15% 2-4% 5-8 Stocks 7-10% 10-15% 1 Month Techno Funda 15% 5-10% 1-2 Stocks 10% and above 15% and above 6 Months Gladiator Stocks 15% 5-10% 1-2 Stocks 15% and above 20% and above 6 Months Cash 10% - 100% 6
Pankaj Pandey Head Research pankaj.pandey@icicisecurities.com ICICIdirect.com Research Desk, ICICI Securities Limited, 1st Floor, Akruti Trade Centre, Road No 7, MIDC Andheri (East) Mumbai 400 093 research@icicidirect.com 7
Disclaimer ANALYST CERTIFICATION We /I, Dharmesh Shah, Dipesh Dagha, Nitin Kunte, Pabitro Mukherjee, Vinayak Parmar Research Analysts, authors and the names subscribed to this report, hereby certify that all of the views expressed in this research report accurately reflect our views about the subject issuer(s) or securities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) or view(s) in this report. Terms & conditions and other disclosures: ICICI Securities Limited (ICICI Securities) is a full-service, integrated investment banking and is, inter alia, engaged in the business of stock brokering and distribution of financial products. ICICI Securities Limited is a SEBI registered Research Analyst with SEBI Registration Number INH000000990.ICICI Securities is a wholly-owned subsidiary of ICICI Bank which is India s largest private sector bank and has its various subsidiaries engaged in businesses of housing finance, asset management, life insurance, general insurance, venture capital fund management, etc. ( associates ), the details in respect of which are available on www.icicibank.com ICICI Securities is one of the leading merchant bankers/ underwriters of securities and participate in virtually all securities trading markets in India. We and our associates might have investment banking and other business relationship with a significant percentage of companies covered by our Investment Research Department. ICICI Securities generally prohibits its analysts, persons reporting to analysts and their relatives from maintaining i i a financiali interest in the securities ii or derivatives i of any companies that the analysts cover. The information and opinions in this section have been prepared by ICICI Securities and are subject to change without any notice. The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent of ICICI Securities. While we would endeavour to update the information herein on reasonable basis, ICICI Securities is under no obligation to update or keep the information current. Also, there may be regulatory, compliance or other reasons that may prevent ICICI Securities from doing so. Non- rated securities indicate that rating on a particular security has been suspended temporarily and such suspension is in compliance with applicable regulations and/or ICICI Securities policies, in circumstances where ICICI Securities might be acting in an advisory capacity to this company, or in certain other circumstances. The research recommendations are based on information obtained from public sources and sources believed to be reliable, but no independent verification has been made nor is its accuracy or completeness guaranteed. These research recommendations and information herein is solely for informational purpose and shall not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments. ICICI Securities will not treat recipients as customers by virtue of their receiving these recommendations. Nothing in this section constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances. The securities discussed and opinions expressed herein may not be suitable for all investors, who must make their own investment decisions, based on their own investment objectives, financial positions and needs of specific recipient. This may not be taken in substitution for the exercise of independent judgment by any recipient. The recipient should independently evaluate the investment risks. The value and return on investment may vary because of changes in interest rates, foreign exchange rates or any other reason. ICICI Securities accepts no liabilities whatsoever for any loss or damage of any kind arising out of the use of these recommendations. Past performance is not necessarily a guide to future performance. Investors are advised to see Risk Disclosure Document to understand the risks associated before investing in the securities markets. Actual results may differ materially from those set forth in projections. Forward-looking statements are not predictions and may be subject to change without notice. 8
Disclaimer ICICI Securities or its associates might have managed or co-managed public offering of securities for the subject company or might have been mandated by the subject company for any other assignment in the past twelve months. ICICI Securities or its associates might have received ed any compensation from the companies mentioned ed hereinei during the period preceding twelve months from the date of these recommendations for services in respect of managing or co-managing public offerings, corporate finance, investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction. ICICI Securities or its associates might have received any compensation forproductsorservicesotherthaninvestmentbankingormerchant banking or brokerage services from the companies mentioned herein in the past twelve months. ICICI Securities encourages independence in research report preparation and strives to minimize conflict in preparation of research report. ICICI Securities or its associates or its Analysts did not receive any compensation or other benefits from the companies mentioned in the report or third party in connection with preparation of the research report. Accordingly, neither ICICI Securities nor Research Analysts and their relatives have any material conflict of interest at the time of publication of this reports. It is confirmed that Dharmesh Shah, Dipesh Dagha, Nitin Kunte, Pabitro Mukherjee and Vinayak Parmar, Research Analysts giving these recommendations have not received any compensation from the companies mentioned herein in the preceding twelve months. Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactions ICICI Securities or its subsidiaries collectively or Research Analysts or their relatives do not own 1% or more of the equity securities of the company/companies mentioned herein asof the last day of the month preceding the publication i of these research recommendations. Since Associates (ICICI group companies) of ICICI Securities are engaged in various financial service businesses, they might have financial interests or beneficial ownership in various companies including the subject company/companies mentioned herein. It is confirmed that Research Analysts do not serve as an officer, director or employee or advisory board member of the companies mentioned herein. ICICI Securities may have issued other reports that are inconsistent with and reach different conclusion from the information presented herein. Neither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies mentioned herein. We submit that no material disciplinary action has been taken on ICICI Securities by any Regulatory Authority impacting Equity Research Analysis activities. This report or recommendations are not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject ICICI Securities and affiliates to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction. 9