HAL Q4: Net Profit Jumps 52% to Rs.4309 CR YoY
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00:00 Richard Jain now joins in with his view on the markets and his strategies.
00:03 Richard, before I get a view on the Nifty from you, we were in conversation with HAL,
00:08 the Prime Minister talked about HAL, the earnings have been phenomenal,
00:11 the management has put out a very strong guidance and the stock has been a star.
00:15 At these levels, would you buy HAL? Any strategy on the counter? It's off the day's high point though.
00:20 Yes, hi, very good afternoon, Samina. Samina, there is no doubt about the trend the stock has
00:26 been in since last one and a half to two years and still you can see that in spite of this
00:31 recent run-up which we have seen, the volumes in the cash segment are still very high. So,
00:36 I think this outperformance which we have seen recently that is likely to continue. So, in case
00:40 if anyone is looking to buy fresh over here, in spite of this run-up, I think one can look at
00:45 taking some exposure, some percentage of exposure over here and in case if we get any dip in the
00:50 near future, then look to add more positions over there. The overall trend still remains positive
00:54 from a mid-term perspective. So, certainly HAL remains a buy at current levels also and if we
01:00 get any dips, then one should take that as an opportunity to accumulate more. Okay, Ruchit,
01:05 let's shift focus to the benchmarks then. And I was just taking a look at the FII numbers this
01:11 morning when it comes to their longs and shorts in index futures. While the Nifty continues to
01:17 hover around 22,500, the FII short number looks substantially high at around 72% if I'm not
01:24 mistaken. Of course, it's likely to change. Overall, what is your assessment of how positioning has
01:30 been from the propriety desk, from FIIs and what is your own reading when it comes to technicals
01:35 of the Nifty? Yeah, very good morning, Agam. So, Agam, if you see FIIs have been on the short side
01:41 throughout the cities along with the cash segment, they have also sold in the futures segment. But
01:45 all the selling has been absorbed by the client section which involves retail as well as HNI
01:49 traders. So, the long short ratio if we see then 67-68% is the long positions of clients whereas
01:55 28% is the long positions of FIIs. If we look at the absolute net short positions of FIIs,
02:02 net shorts minus longs if we do, then that comes around 2,46,000 contracts. Although in historical
02:08 terms, it may be around its record highs, it's too high. But no, it's not right to compare with
02:13 that historical data because recently the Nifty lot size has changed. But we should compare that
02:18 in percentage terms. So, that 28% long short ratio which we are witnessing has become short heavy
02:23 whenever that ratio goes below 20%. So, I think still a lot of short positions that we might see
02:28 FIIs continuing this short position with the short positions in the near term. But in case if the
02:33 market continues to sustain about 22,500, then I think the shorts would come to cover. So, that
02:39 short covering would add fuel to this ongoing ready. Technically also, we have formed a very
02:44 strong support base around the 22,000 mark. Now, immediately 22,300 has become a very short-term
02:49 support. So, the market remains a buy-on-dip because the broader market has been doing well.
02:53 So, we are advising our clients to keep a buy-on-dip approach and in case if we get any
02:57 dip towards that 22,400 to 22,300 range of the Nifty, then I think one should take that as a
03:03 good approach to create fresh long positions. When we see markets sustaining about 20-500,
03:08 then I mean the short positions of FIIs will come to cover. All right, Ruchit, let's talk about
03:13 stocks then. What makes it on your radar at the moment? So, momentum is very strong in PSU names
03:19 in the metal space. So, I have a couple of buy recommendations, one from each segment. From the
03:24 metal space, I'll go with Tata Steel where a fresh breakout has been seen of previous swing highs.
03:29 Even if you look at the options segment, 170 call option had significant open interest outstanding.
03:36 So, all the call writers, I think they have started covering their positions. Today, we can
03:40 see change in open interest in the call options, everything, most of the call writers are
03:44 declining. So, clearly short covering move along with the long formations in the future segment.
03:49 So, Tata Steel can be bought with stop-loss below 167 expecting targets around 177 to 178
03:55 and within the PSU basket, whole India is looking quite positive. A higher top, higher bottom
04:00 structure, good price volume action, post the results, the stock has went through some consolidation
04:04 phase. So, I think this could resume its uptrend. So, from a bit short-term perspective, one can go
04:08 along with stop below 469 for potential targets around 550. Okay, there you have it, Richard.
04:15 Before I let you go, just a quick view on the Bank Nifty as well. Is that a similar view as
04:22 compared to the Nifty? A bit of relative underperformance, I would say, has been seen in
04:28 the Bank Nifty in this last 3-4 days. Structure is not negative but it's looking more of a consolidation
04:33 or sideways from a very short-term perspective. Maybe adding 48,200 to 250 is that one level which
04:39 needs to break out for any momentum to kick in Bank Nifty. And of course, if we resume the uptrend
04:43 on the Nifty, where if we move towards that record high again, then it cannot be done without the
04:48 support of the Bank Nifty. So, I would wait for a breakout above 48,250 before taking long positions
04:55 into Bank Nifty. So, maybe one or two days of consolidation could be seen in the Bank Nifty
04:59 before we see any kind of positive momentum.