July 24, 2017 Weekly Call Research Analysts Dharmesh Shah Nitin Kunte, CMT Dipesh Dagha Pabitro Mukherjee Vinayak Parmar dharmesh.shah@icicisecurities.com nitin.kunte@icicisecurities.com dipesh.dagha@icicisecurities.com pabitro.mukherjee@icicisecurities.com vinayak.parmar@icicisecurities.com
Weekly Deal Team Calls At Your Service Kirloskar Electric (KIRLOS) Code KIRLOS CMP 53.50 Comment (1) Breaking above 7-month long flat base formation. o (2) Attracting higher volumes on breakout. (3) Weekly Moving Averages are in +ve mode. (4) Weekly Oscillator is in +ve mode. Action Buy in the range of 51-53 53 Reco. Date 24th Jul 2017 Stop-loss 48.50 Targets 61 / higher All levels are as per cash segment Source: ASA, ICICIdirect.com Research 2
Weekly Deal Team Calls At Your Service Network18 (NETW18) Code NETW18 CMP 54.85 Comment (1) Making higher top higher bottom holding Green support line. (2) Attracting higher volumes in the rally. (3) Holding above previous resistances marked in Red. (4) Weekly Moving Averages in +ve mode. Action Buy in the range of 53-55 Reco. Date 24th Jul 2017 Stop-loss 50 Targets 64 / higher All levels are as per cash segment Source: ASA, ICICIdirect.com Research 3
Trend Scanner Deal Team At Your Service Positive Trends Scrip Name Close 50 days EMA 100 days EMA Delivery % 5 days Averge Axis Bank 540.8 511.0 507.0 53.00 Britannia 3,834.1 3,642.0 3,526.0 57.00 Wipro 286.0 260.0 255.0 44.00 Voltas 499.7 465.0 439.0 40.00 Negative Trends Scrip Name Close 50 days EMA 100 days EMA Delivery % 5 days Averge Exide Industries 216.7 224.0 221.0 49.00 Petronet LNG 205.6 213.0 208.00 72.00 Candlestick Pattern Bullish Candlestick Formations Bearish Candlestick Formations Scrip Name Pattern name LTP Scrip Name Pattern name LTP Godrej Property Engulfing 526.1 Canara Bank Dark cloud cover 350.0 Jyothy Laboratories Engulfing 385.0 KPIT Evening Star 125.8 Adani Ports Piercing line 382.5 Mindtree Continuation 484.9 Voltas Continuation o 500.0 0 Exide Inds Continuation o 215.9 Bajaj Finserv Continuation 4930.0 Wipro Continuation 285.7 BEML Continuation 1608.4 Britannia Industries Continuation 3834.1 Legend Positive and Negative Trends: The stocks listed in the positive and negative trends section above have been identified after running multiple technical queries based on combination of various technical parameters applied on a group of NSE cash stocks. The query modules are designed to recognise stocks, which are either at attractive technical entry levels based on overall price structure or resolving out of medium term consolidation. Consequently the query modules are also aimed at identifying the stocks which are under performers or in established down trends and therefore may not be good bets from short to medium term perspective. Candlestick patterns: Candlestick formations on weekly time interval charts typically point towards the prevailing sentiment comprising the entire trading week and could proveas an important tool for short term traders. By themselves, the patterns do not carry any price target but only an indication of change in market behaviour. More importance needs to be given to the placement of the pattern within larger trend. A more detailed description of Candlestick patterns and the way to understand them is listed at the end of the report Source: Bloomberg, ICICIdirect.com Research 4
Market Activity Global l Markets Domestic Sectoral Indices Performance HSI Index SHCOMP Index INDU Index CAC Index 26,706.1 1.2% 3,238.0 0.5% UKX Index NKY Index 7,452.9 1.0% 20,099.8-0.1% 21,580.1 64,684.2 IBOV Index -0.3% -1.1% 5,117.7-2.2% DAX Index Global Currencies, Commodities & Bond Yields Rupee ( ) Euro Japanese Yen Gold/ounce Brent Crude/barrel India 10 year EURO 10 Year 12,240.1-3.1% 64.32 93.90 Dollar Index 0.2% -1.3% 1.17 1.30 British Pound 1.8% -0.7% 110.95 Swiss Franc 0.95-1.5% -1.9% 1,254.44 5,971.00 Copper (tonne) 1.8% 2.0% 47.97 Silver (ounce) 16.5-2.2% 2.6% 6.44-2.6 bps 0.50-8.8 bps US 10 Year JPY 10 Year 2.23-10.1 bps 0.06-1.1 bps INDICES Current 1Wk 1M 3M Sensex 32028.89 0.0 3.2 8.4 Nifty 9915.25 0.3 3.7 8.1 Auto 24373.27 0.7 4.2 10.8 Banking 27496.11 1.4 4.4 12.2 Capital goods 17715.5656 0.4 4.1 2.22 Cons durables 16082.28 0.7-0.7 2.5 FMCG 10102.5-6.6-3.1 8.5 Healthcare 14837.61 0.9 5.1-2.3 IT 10322.16 2.7 3.3 4.5 Metal 12187.53 1.9 7.1 9.5 Oil & gas 14054.11 1.0 5.4-2.4 Power 2289.7 0.1 3.3-0.5 Realty 2160.5 1.0 6.9 16.4 BSE 500 13704.49 0.3 2.3 7.3 BSE midcap 15185.53 0.0 3.7 4.8 BSE small cap 15992.63 0.5 3.8 5.8 Nifty Gainers / Losers for the week (%) 6.4-5.6-17.6 10.1 WIPRO 8.1 ZEEL 6.4 5.4 HCLTECH AXISBANK -2.0-2.6-3.4-14.3 HEROMOTOCO ACC GAIL ITC Source: Bloomberg, ICICIdirect.com Research 5
Deal Team At Your Service Market Activity Institutional flow trends of last 12 months 34000.00 29000.00 17 73 2977 4892 FII DII Sensex 20,000 3713-86 12612 248 9071 698 10443 1521-4306 8106-18244 9900-8176 6547-1177 4777 9902-23 30906 2368 2394 8916 7711 6725 36 48 10,000 0-10,000-20,000 24000.00 19000.00 June'16 July'16 Aug'16 Sep'16 Oct'16 Nov'16 Dec'16 Jan'17 Feb'17 Mar'17 Apr'17 May'17 Jun'17 July'17 Months Weekly market breadth trends Advance % Decline % Sensex 80% 60% 40% 20% 31028 31273 31262 31056 32021 32029 31138 30922 31361 33500 32000 30500 29000 27500 26000 24500 23000 21500 20000 Percentage 46% 54% 51% 49% 44% 56% 60% 40% 51% 49% 0% 26-May-17 2-Jun-17 9-Jun-17 16-Jun-17 23-Jun-17 30-Jun-17 7-Jul-17 14-Jul-17 21-Jul-17 Week Ended Source: Bloomberg, ICICIdirect.com Research 6
Previous Week s Performance Deal Team At Your Service Date Scrip Product Strategy RP Target SL Gain/Loss % Comment 17-Jul-17 Aditya Birla fashion Cash Buy 179.00 197.00 169.00-1.0 Square off at 177 17-Jul-17 SJVN Cash Buy 33.50 37.00 31.00 - Square off near cost F&O Stocks Pivot points for the Week (July 24 28, 2017) COMPANY CMP S1 S2 S3 R1 R2 R3 Trend SENSEX 32028.89 31852.60 31726.25 31538.95 32105.35 32231.75 32419.00 Neutral BANK NIFTY FUTURE 24247.60 24202.05 24110.10 24018.15 24386.00 24522.25 24658.50 +ve NIFTY FUTURE 9910.55 9875.10 9847.4040 9787.50 9930.60 9958.35 10018.20 Neutral BANK NIFTY 24257.05 24206.90 24110.40 24013.95 24399.90 24568.60 24737.35 +ve NIFTY 9915.25 9862.85 9828.80 9762.10 9930.90 9964.95 10031.65 Neutral ACC 1708.60 1666.35 1626.30 1586.20 1723.15 1751.55 1779.90 -ve ADANI PORT 381.90 380.95 378.35 375.80 386.05 387.75 389.50 +ve AMBUJA CEMENT 266.10 265.90 263.20 260.45 271.35 274.85 278.35 +ve ASIAN PAINTS 1156.10 1152.00 1137.70 1123.40 1180.65 1188.70 1196.75 +ve AUROBINDO PHARMA 748.25 719.30 704.60 689.90 752.60 769.30 785.95 -ve AXIS BANK 540.80 535.95 527.00 518.05 553.90 557.30 560.75 +ve BAJAJ AUTO 2815.80 2805.90 2791.90 2762.40 2833.80 2847.75 2877.25 Neutral BOB 161.75 160.85 159.25 157.50 164.10 165.70 167.45 Neutral BPCL 467.15 463.50 459.75 453.70 471.00 474.7575 480.8585 Neutral BHARTI AIRTEL 411.30 399.25 393.20 387.15 412.95 419.80 426.65 -ve BHEL 145.00 144.55 142.70 140.85 148.25 150.35 152.40 +ve BHARTI INFRATEL 410.30 399.45 394.85 390.30 411.20 417.10 422.95 -ve BOSCH 23971.45 23576.20 23331.00 23085.80 24097.00 24357.45 24617.85 -ve CIPLA 566.20 564.75 557.15 549.60 579.90 584.05 588.20 +ve Source: NSE India, ICICIdirect.com Research 7
F&O Stocks Pivot points for the Week (July 24 28, 2017) COMPANY CMP S1 S2 S3 R1 R2 R3 Trend COAL INDIA 262.35 259.70 255.40 251.10 268.30 271.25 274.20 +ve DR.REDDY'S LAB. 2762.55 2752.90 2727.25 2701.65 2804.15 2823.35 2842.55 +ve EICHER MOTORS 28903.15 28819.15 28448.55 28077.90 29560.45 29751.15 29941.80 +ve GAIL 377.00 371.15 362.60 354.05 378.90 382.80 386.65 -ve GRASIM 1061.10 1009.50 995.95 982.45 1062.45 1088.90 1115.35 -ve HCL TECH 904.95 895.30 879.25 863.25 927.35 937.05 946.80 +ve HDFC 1640.95 1630.20 1616.55 1605.55 1657.50 1671.15 1682.20 Neutral HERO MOTO 3682.00 3638.35 3609.75 3581.15 3700.35 3731.35 3762.35 -ve HINDALCO 214.55 213.35 210.95 208.60 218.05 221.45 224.85 +ve HIND. UNILEVER 1158.65 1127.45 1113.70 1099.95 1159.95 1176.20 1192.45 -ve IDEA CELLULAR 91.95 91.80 89.35 86.90 96.75 98.55 100.40 +ve INDUSIND BANK 1566.65 1558.70 1550.30 1535.60 1575.50 1583.90 1598.55 Neutral INFOSYS 980.10 963.10 945.25 927.40 982.05 991.50 1000.95 -ve ITC 288.90 265.20 261.50 257.85 294.50 309.15 323.80 -ve KOTAK MAH.BANK 999.45 997.45 985.95 974.45 1020.45 1028.50 1036.55 +ve L & T 1179.25 1170.95 1162.95 1151.25 1187.00 1195.00 1206.70 Neutral LUPIN 1142.90 1135.15 1123.60 1111.25 1158.25 1169.80 1182.20 Neutral M & M 1386.05 1376.00 1366.05 1355.30 1395.80 1405.70 1416.50 Neutral MARUTI SUZUKI 7543.00 7498.10 7461.50 7414.25 7571.40 7608.00 7655.25 Neutral NTPC 164.80 160.50 157.95 155.35 165.50 168.00 170.45 -ve ONGC 164.35 164.00 161.75 159.50 168.55 170.70 172.90 +ve POWER GRID 215.30 212.55 210.65 208.75 215.80 217.40 219.05 -ve RELIANCE 1585.00 1573.80 1553.60 1533.45 1614.15 1626.40 1638.65 +ve SBI 290.65 287.15 283.75 280.40 291.20 293.25 295.30 -ve SUN PHARMA 575.95 565.15 557.65 550.15 577.15 583.15 589.15 -ve TATA MOTOR DVR 274.80 274.50 273.00 271.50 277.50 280.80 284.10 +ve TATA MOTORS 464.60 462.80 459.50 456.15 469.45 476.70 483.95 +ve TATA POWER 83.35 82.70 82.15 81.50 83.80 84.35 84.95 Neutral TCS 2491.20 2474.50 2445.05 2415.60 2533.40 2579.10 2624.85 +ve TECH MAHINDRA 394.70 391.95 389.00 385.60 397.75 400.65 404.10 Neutral TATA STEEL 553.25 540.50 536.25 532.05 554.85 562.00 569.20 -ve ULTRATECH CEMENT 4176.65 4056.00 4020.75 3985.50 4215.85 4295.75 4375.70 -ve WIPRO 286.05 283.30 276.70 270.10 296.45 301.75 307.05 +ve YES BANK 1577.65 1572.55 1563.05 1553.55 1591.60 1615.10 1638.55 +ve ZEE 556.05 549.00 537.60 526.20 571.80 575.55 579.35 +ve Source: NSE India, ICICIdirect.com Research 8
Forthcoming Economic Events Calendar Deal Team At Your Service Date Event India Quarterly Results 24-Jul Ambuja Cement,HDFC bank,zee,m&m Finance 25-Jul Asian paint.axis Bank,Bharti Airtel,HeroMotocorp 26-Apr HDFC,Inox leisure,pvr,federal Bank 27-Jul Biocon,Dr Reddy,ITC,Maruti,ONGC,IDEA,,, 28-Jul Escorts,heidelberg Cement,L&T Japan 24-Jul Nikkei Japan PMI Mfg 26-Jul PPI Services YoY 27-Jul Japan Buying Foreign Bonds US 24-Jul Markit US Manufacturing PMI 24-Jul Markit US Services PMI 26-Jul FOMC Rate Decision (Upper/Lower Bound) 28-Jul GDP Annualized QoQ Euro Zone 24-Jul Markit Eurozone Manufacturing PMI 24-Jul Markit Eurozone Services PMI 26-Jul M3 Money Supply YoY 28-Jul Economic Confidence UK 24-Jul CBI Retailing Reported Sales 26-Jul GDP QoQ 28-Jul GfK Consumer Confidence Source: Bloomberg, ICICIdirect.com Research 9
Notes Deal Team At Your Service The weekly call recommendation are in the cash segment only Please execute the recommendation 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 We adapt a trading strategy of booking profit when the position is in profit by 3-5% and trail stop loss on remaining position to the entry point In recommendations where it is advised to buy on declines, if the target price is hit before activation of the call in prescribed range then the recommendation is considered not initiated The recommendations are valid only for the week and are to be squared off by the end of the week. 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 trading corpus to asingle stock or a single product segment Within each product segment it is advisable to allocate equal amount to each recommendation For example: The Daily Calls product carries 3 to 4 intraday recommendations. It is advisable to allocate equal amount to each recommendation 10
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% 1-2Stocks 15% and above 20% and above 6 Months Cash 10% - 100% 11
Candlesticks Glossary: Deal Team At Your Service Candlestick patterns describe the market sentiment for the specified period. Some of the formations suggest reversal of sentiment (trend) and, therefore, are important for a chart reader. By themselves, the patterns do not carry any price target but only an indication of change in market behaviour. More importance needs to be given to the placement of the pattern within larger trend Morning Star: Potential bottom reversal pattern made of three candle lines. The first sizeable black candle reflects a market in which the bears are in complete charge. The next candle line--the small real body--shows a slight diminution of the bearish force. The white candle that makes up the last part of the morning star visually displays the bulls are gaining the upper hand. Lowest low amongst three candles becomes technical support Bullish Engulfing Line: A potential bottom reversal pattern. This pattern typically appears at the culmination of a decline or downtrend. The market falls, and a black candle forms (ideally a small black candle). Next, a white real body wraps around the prior session s black body. Low of the pattern becomes short term support for prices Piercing Line: Potential bottom reversal pattern. A black body forms in the downtrend. The market continues moving south on the next session s open but that session culminates in a white real body that closes (e.g. pierces) than half way or more into the prior black body. Lowest low between two candles is referred to as technical support for prices Hammer: A candlestick line which, during a downtrend, has a very long lower shadow and small real body (black or white) at the top end of the session s s range. There should be no, or a very small, upper shadow. Pattern suggests buying support during declines and needs confirmation in terms of sustainability of prices above head of the Hammer in following session Evening Star: Potential Top reversal pattern made of three candle lines. Comparable with a traffic signal. First white candle reflects a market in bullish trend. The next candle line--the small real body warns waning momentum. The black candle that completes the evening star visually exhibits that prior up trend has stopped or reversed Bearish Engulfing Line: Potential top reversal signal. This two candlestick pattern emerges during a rally. A black candle real body wraps around a white real body (classically a small white candle) Highest high between two candles becomes resistance level for prices for future reference Dark Cloud cover: A dark cloud cover forms a top reversal pattern. The first session should be a strong, white real body. The second session s price opens over the prior session s high (or above the prior session s close). By the end of the second session, it closes near the low of the session and should fall well into the prior session s white body. Pattern suggests that market has a poor chance of rising immediately Shooting Star: A single candlestick line during a rally in which there is a small real body(whiteorblack)atthebottomendofthesession'srangeandavery long upper shadow. The candle line should also have little or no lower shadow. Pattern suggest the trouble for prices overhead Continuation Patterns: Other than widely known Candlestick reversal patterns discussed above, there are numerous patterns mentioned in literature on Candlestick which describe the continuation of existing sentiments i.e. bullish or bearish. We have refrained from mentioning names of these patterns to avoid confusion. However, the remark Continuation Pattern refers to bullish or bearish candlestick patterns which suggest continuation of existing trend 12
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
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. 14
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. 15