RIL & HUL In Focus | The F&O Show | NDTV Profit
- #Sensex, #Nifty trade marginally higher
- #RIL, #HUL in focus
Take stock of the derivative markets with Agam Vakil on 'The F&O Show'. #NDTVProfitLive
- #RIL, #HUL in focus
Take stock of the derivative markets with Agam Vakil on 'The F&O Show'. #NDTVProfitLive
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TVTranscript
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02:01 >> Benchmark indices flat as Innocent Bank, HUL fall, Bharti Airtel, ICICI Bank lead gains.
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02:10 Sectoral action mixed media comes out as the top sectoral gainer.
02:14 On the other hand, FMCG and Realty are the top losers.
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02:21 Reliance Industries Q3 net revenue and profit decline on refinery shutdown,
02:26 misses analyst expectations.
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02:31 Nature falls of the company's third quarter results missed analyst estimates.
02:36 Net profit rises 1.1%, while revenue declines 0.2%.
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02:43 >> Amid a slew of earnings expected to come out today, we have banking majors,
02:48 ICICI Bank and Kotak Mahindra Bank,
02:50 scheduled to come out with their December quarter earnings.
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03:11 >> Hello and welcome. This is Agam Makhil.
03:13 You're watching the FNO Show.
03:14 And in this show, we take you through all that is happening in the futures and options space
03:17 in Indian equity markets.
03:19 For now, a quick look at how the markets are faring.
03:23 A quiet Saturday morning. Yes, it is a Saturday.
03:27 And we are trading on a Saturday, a full trading session here.
03:31 Marginal gains coming through 0.2% advance.
03:34 And currently, the Nifty sustaining about 21,600.
03:38 The Sensex as well, advancing by just as much.
03:42 And though we did see the benchmarks dip momentarily in the red,
03:46 we've seen a little bit of an up move since then.
03:50 Both the benchmarks of days lows.
03:53 The Nifty Bank, on the other hand, is advancing by around 0.5% as we speak.
03:57 Remember that we are going to see ICICI Bank and Kotak Mahindra Bank
04:02 announce their earnings today.
04:04 But as far as the broader markets go, both the mid-cap as well as the small-cap indices,
04:10 well, they are looking at a mixed day of trade.
04:13 And while the mid-cap index is outperforming the benchmarks at the moment up by around 0.7%,
04:19 the small-cap index is moving largely in tandem with the benchmark.
04:24 So that's as far as your key indices go.
04:28 Let's take a look at how the futures and options space is spanning out.
04:31 Perhaps you can start off with the Nifty futures at the moment.
04:35 Remember that today it's going to be a day of thin trade
04:39 because we don't have institutional activity.
04:42 FPI is, of course, on account of the holiday.
04:45 And the mutual fund industry has decided to stay shut today.
04:48 So we won't have DII activity here today either.
04:52 That said, as far as the Nifty futures go,
04:54 we are still looking at a 2.7% increase in open interest towards what looks like fresh longs.
05:00 And as far as the Bank Nifty futures are concerned,
05:03 well, that's where we are not seeing a lot of action, at least in terms of open interest change.
05:08 The index, of course, advances by 0.5% as we speak at the moment.
05:13 Let's take a look at how options are panning out, at least as far as the Nifty is concerned.
05:19 Remember we were talking about the 500-point range between 21,500 on the lower end and 22,000 on the higher end.
05:26 Can this range sustain? Is this what we are expecting to see the Nifty move within as we move into the next few days?
05:35 Perhaps, but at least that's where the writers are coming through.
05:39 And speaking of them, let's take a look at where we have seen the most amount of traction in terms of options today.
05:46 We are looking at a lot more writing around 21,400 and 21,500 puts.
05:52 Not too much activity as far as calls are concerned, but we will continue to keep an eye on that one.
05:58 On that note, let's bring in our experts for today.
06:02 We have Shilpa Rao. She is the derivatives lead analyst at Prabhudha's Leeladhar,
06:07 as well as Ashish Kyal. He is the founder and CEO of Wave's Strategy Advisors joining us on the show.
06:14 Good morning to both of you. And thanks for taking the time out on a Saturday.
06:18 These are exceptional times, but I reckon that that would also need exceptional measures.
06:25 Shilpa, good morning to you. Let's start with you. Your view on the benchmarks going in. How have you placed?
06:31 Good morning, everyone. Talking about the indices, we see that Nifty and Bank Nifty, as already mentioned,
06:37 you know, by your that it's going to be in trade. Yeah, it is looking like, you know, we don't have much of a trade set up here.
06:45 We the VWAP, if you see also in futures for Nifty is around 21,702.
06:50 And that is where we are. And for Bank Nifty, it is around 45,925.
06:55 So that is where we are. So this VWAP up and down, we are seeing the, you know, levels coming up.
07:01 So, you know, a little short trade can be, you know, if you want to go long, keep the day low as a stop loss and stay long.
07:09 But not much of an upside because whatever it is, you know, I believe that one should be sparing of their trades today, intraday,
07:18 and not carrying anything for Tuesday, because then again, Sunday, Monday, we have a holiday
07:24 and we don't know how the sector would be for Tuesday morning.
07:27 Since majority of the global markets are closed and even the mutual fund industry, they're not participating.
07:35 So not carrying much of a trade for Tuesday, you know, whatever the view is, one should, you know, square it up intraday would be the advice.
07:43 Ashish, good morning to you as well. How have you placed on the benchmarks?
07:46 Not just today, but perhaps positionally speaking over the next few days?
07:51 See, if you look at the overall benchmark indices, we can see a very sharp cut that happened just about three days back
07:57 and how the markets corrected sharply to the low of around 21,250 odd levels.
08:03 From there, we are seeing some kind of a recovery sign, but I think this can be a pullback.
08:08 After such a sharp fall, we are seeing a sharp rise usually results into a sideways pattern, kind of a triangle or a consolidation.
08:15 So I think markets going forward positionally is going to be broadly in a range with 21,840 as the hurdle on the upside
08:23 and the support on the downside is going to be around 21,420.
08:26 So there's a broad range of around 400 points on Nifty. That's how I see the market is going to phase out.
08:32 And for today, I think it's better to trade light. There's going to be thin volume and it can be erratic also.
08:38 So we can have false breaks. Having said that, I think if Nifty manages to sustain about that 21,680 levels,
08:44 we can expect a move toward 21,750 in today's session, but that has to be a sustainable move.
08:51 And on the downside, the support for today is going to be somewhere around 21,520, 21,540 levels.
08:57 So that is the range for today and the broadly, as I said, 21,840 and 21,420. That's the range for the coming days.
09:05 Right. Ashish, but there's been a little bit of divergence in the way the Bank Nifty has moved with respect to the benchmarks.
09:11 How do you place there?
09:13 Yes, absolutely. If you look at Nifty has managed to show a decent recovery, but Bank Nifty has still failed to do that.
09:20 Very interesting. One more observation is that Nifty managed to close above the prior day and high yesterday,
09:25 but Bank Nifty did not do that. So that's a sign of concern.
09:29 I think if Bank Nifty manages to break back below that 45,430 mark on the downside,
09:35 there will be selling pressure and Bank Nifty can lead on the downside because everything, if you look at it,
09:41 Nifty collapsed only because there was selling pressure in the banking stocks, not only HDFC Bank,
09:46 but the others also started participating later on. And right now we are seeing some kind of a pullback.
09:51 So the way I'm seeing the Bank Nifty also, whatever pullbacks we are seeing is going to be sold into eventually positionally.
09:58 So for me, key level for Bank Nifty is going to be around 45,430. Below that, it's a sell.
10:06 And on the upside, Bank Nifty will have a tough time crossing that level of around 46,600.
10:11 So that's how it's going to play around.
10:13 All right. Let's talk about the two big stocks then, the results of which we have on our hands.
10:19 And these are relatively big stocks, big enough because there will be so many hands at play.
10:25 The question here is that how do you go about this?
10:28 So first one is Reliance Industries. And I'll take this up with Shilpa.
10:32 We've had earnings and the earnings have been largely in line with expectations, if not for a miss here and there.
10:39 But on the whole, you know, it was in line with expectations.
10:42 And again, the stock is not seeing too much going in.
10:45 Shilpa, now that the overhang of the earnings is out of the way,
10:49 do you expect Reliance Industries also to consolidate going forward?
10:53 Or do you in fact see a trend developing? And based on that, how would you place your bets here?
11:03 Agam, if you see Reliance in the past one month, you know, has seen a rally of more than 250 points.
11:10 You know, we had initiated one coverage on Reliance around 2460 for targets of 2750 just before the New Year's.
11:17 And we saw this rally happening and the targets are met.
11:21 So here, I would actually ask everybody to be a little cautious.
11:25 If Reliance sustains above 2780, that is where, you know, I would say that, you know,
11:31 fresh trajectory on the upside is opening up where you can see targets of 2900 to 3000 zones.
11:37 But here, I wouldn't, you know, suggest anybody to go long right now.
11:41 It can move sideways. It has seen a good rally in the past one month.
11:45 So some consolidation can happen. So on declines till 2600 to 2550, if one gets, one should buy.
11:52 Otherwise, wait for a decisive sustenance above 2780.
11:56 Okay. And the other big stock that I wanted to address was Hindsaan Unilever,
12:00 where the earnings have come through, largely in line with expectations,
12:04 but a little bit of a miss when it comes to the volumes number.
12:07 And consequently, we are looking at a decline of 3% in today's Jio trade.
12:12 Ashish, the same question to you. The results are out of the way now.
12:16 And there has been a little bit of weakness coming through.
12:19 But based on the data that we have at the moment, how would you place your bets on Hindsaan Unilever?
12:25 See, if you look at Hindsaan Unilever, the stock is breaking down in today's session.
12:30 So that's going to be a concerning sign. And we can see even on the daily,
12:34 the balling bands are getting broken now as we speak.
12:37 And that shows that the downside trend for this stock is resuming.
12:41 So I would not be buying and trying to catch a falling knife.
12:46 Rather, if I get a pullback around the levels of 2500, 2510,
12:50 I will again short this stock, keeping a stop loss of around 2530 levels on the upside.
12:56 And the important support on the downside is 2450.
13:00 So for me, the hurdle on the downside, the support is 2450.
13:05 And on the upside, I'm going to be looking at the stock to not cross that 2530 level.
13:10 So use pullback to sell.
13:12 Use a pullback to sell Hindsaan Unilever. That's the word coming in from Ashish
13:17 on how to deal with that FMCG giant.
13:19 But on that note, we slip into a break.
13:21 But on the other side, we talk about stock ideas from our experts.
13:24 Stay tuned in.
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16:22 Welcome back. This is the EFNO Show.
16:24 And we now put the spotlight on all the trading ideas that our experts can give us.
16:30 Ashish, I'll start with you.
16:31 What are the bets that you're placing as far as stocks are concerned?
16:36 The first stock that I'm looking at overall on the buy side is going to be Coal India.
16:41 We can clearly see that the stock has shown a very good up move and it is sustaining that level also.
16:48 So one can create long positions in Coal India at the current level.
16:52 It is managing to move from a higher high, higher low pattern.
16:56 That's a precursor for the uptrend to continue.
16:58 It took a very good support at 20 days average.
17:01 If you check, this stock has not broken that average since the low was formed around 216 in the month of around September 2023.
17:09 And still that 20 days average is being protected.
17:13 So long positions can be created in Coal India over here.
17:16 And one can maintain a stop loss on the downside for Coal India near the levels of just give me a second,
17:23 near the levels of 379 and aiming for the target of 425.
17:29 So that's the first stock one can look forward for long positions.
17:32 The next is Bandhan Bank.
17:34 We can see some weakness in the banking stock, banking index, but Bandhan Bank is bucking the trend and trying to move up.
17:40 So that is a relative outperformance.
17:42 And I think there will be a pullback.
17:44 So I'm not playing it like a positionally medium term target,
17:48 but I'm playing more for a short term pullback on Bandhan Bank that we can expect from here on.
17:52 And the stock can move towards the mid of the Bollinger Bands resistance,
17:56 which is going to be somewhere around the area of 250.
18:00 So one can create long positions in Bandhan Bank for targets of 250 and maintaining a stop loss of 225.
18:06 OK, so those are two trading ideas from Ashish.
18:10 Shilpa, what about you?
18:12 I have one buy and one sell.
18:14 The buy would be in Apollo Tyres.
18:16 Apollo Tyres showing a good momentum and it has given a breakout and sustaining above 500.
18:21 So that is a buy for me with a stop loss of 498 from here.
18:24 Look for targets of 520 to 540 from here.
18:27 The other one would be a sell.
18:29 A sell would be, you know, I say SIP rule.
18:32 If you see that the stock is trading below 500, which is negative for the stock,
18:38 and as long as it is sustaining below 500, I believe the downside opens still 460 to 440 zones.
18:44 So that is a sell.
18:46 OK, I want to quickly address what's happening in the open interest gainers and losers.
18:51 Let's pull that out once again and see where there is in fact a lot more traction.
18:56 Of course, as we have already mentioned, it's a day where we won't see too much volumes,
19:00 but incidentally, cold India is right at the top of the list where we are seeing a substantial increase in open interest of around 5%,
19:07 even as the stock advances by around 4%.
19:11 This is, of course, one of Ashish's picks at the moment.
19:14 And besides that, we also have something like an excite India where we are looking at shorts building up.
19:20 The underlying is down by less than 1%, but there is an increase of 3% in open interest.
19:26 RSATC is the other interesting one, up 4% right now, longs there, along with Torrent Pharma,
19:31 where we are also seeing longs.
19:33 And IndusInd Bank, on the other hand, under a tad bit of pressure right now, down 1.2%,
19:39 with an increase of 2.5% in open interest towards shorts.
19:43 What about stocks which are seeing unwinding in trade?
19:46 We do have RBL, which is seeing a bout of short covering, even as the stock advances by around 2%,
19:53 but longs unwinding seen in Oracle Financial Services.
19:57 But, I mean, this one has just been on a tear off late, hasn't it, ever since it announced its earnings.
20:04 And since then, we did see a huge, huge up move.
20:07 Of course, today, I reckon that at least a handful of traders will take this as an opportunity to perhaps book positions.
20:15 And that's potentially the reason why we are seeing a 1.7% decline in its underlying,
20:21 even as we see a 4% unwinding as far as open interest is concerned.
20:25 Longs unwinding in BHEL as well.
20:27 And remember that the underlying is not declining as such.
20:32 And BHEL has also been on an upward trajectory off late.
20:37 Metropolis and Aarti Industries are among the two other counters which have been under a tad bit of pressure.
20:44 Let's pull up BHEL. Let's perhaps take BHEL up with Ashish.
20:49 I want to address BHEL because of the fact that there's been so much buying interest off late.
20:54 Pull up the last one month chart and you will see that it has been on an uptrend.
21:00 And we've seen good gains coming through as well.
21:03 In fact, in the last one month, it has gained well over 20%, as you can see on your screen there.
21:08 So there's no doubt about the fact that there has been strength here.
21:12 But Ashish, at the moment, would you initiate fresh longs in BHEL?
21:17 If you look at BHEL, the overall stock, the good part is this is going independent to the broader market.
21:24 So when we saw the correction, this stock did not move anywhere on the downside.
21:28 Secondly, if you look at the weekly chart, the stock has been moving in and protecting the prior weekly low on closing basis for nearly around 10 consecutive weeks.
21:37 So it has not closed below the prior week low for nearly 10 to 11 weekly timeframes.
21:43 So that's again a positive sign. But having said that, if I look at the daily chart, the indicators are overbought.
21:49 We are already seeing a good enough up move. So I would refrain from creating fresh long positions at the current levels.
21:55 If I get a pullback on the downside, if the stock manages to move towards the level of around 210-211,
22:02 then I'll be much more comfortable creating long positions there. And then we can be aiming for the targets of around 230.
22:09 So the risk reward becomes appealing on buy on dip strategy rather than buying at the current levels.
22:14 But if I'm holding on to these positions, I'll continue to hold on.
22:18 I might book partial profits and continue to hold on with the trailing stop loss method with 210 as my stop loss.
22:24 Okay. Just want to very quickly mark Reliance Industries because there's been a sharp spike in the last five minutes.
22:31 And it has moved when it's now gaining about 1% as we speak. So now comfortably above the mark of 2750.
22:39 It's something that we've also been discussing with our experts. But we have run out of time on the show.
22:45 So I'm going to take a moment to thank both our guests here, Shilpa as well as Ashish,
22:50 for joining us and taking us through their views on the markets as well as giving us a long list of trading ideas.
22:56 And on that note, we move on and talk about Hindustan Zinc, which has come out with their third quarter earnings.
23:05 And we spoke to the management about the outlook going forward. This is a slice of that conversation. Listen.
23:13 If you look at revenue on quarter of the same quarter last year was about 7600 crores and this year about 7000 crores.
23:22 But if you look at sequentially from 6600 to 7000 crores, so it is mostly 99% of the fall compared to quarter three of last year is due to the LME.
23:32 Since the LME was lower, so comparatively correspondingly, this could have been far lower.
23:38 The revenue would have been far lower. We could make it up by reducing our cost by about $200 per ton.
23:44 OK. OK. We'll do come back to the LME question. But before that, I have another question, which is for the cost of production for Zinc.
23:53 So now that has been on a declining trend for the four quarters now. So again, over here,
23:58 what strategies are we deploying to ensure this trajectory continues and it remains sustainable?
24:04 So A is one that you have mentioned in the presentation is the softening gold prices.
24:09 But what I want to focus on is the deep bottlenecking measures that we are taking that is going to be driving the operational efficiency.
24:17 So one of the one of the principal reasons of cost reduction is the structural changes in the way we consume coal in producing power.
24:25 Our power plants are designed to consume about 23 to 30 percent of domestic coal only.
24:30 We have deep bottlenecked the power plant as handling capabilities, including the ESPs.
24:35 So now the power plants can go up to 45 percent to up to even 60 percent of the coal mix can be domestic coal, which is high gas and low cost coal.
24:44 And so even quarter two, altogether, we had about 45 percent of domestic coal consumed.
24:50 In quarter three, we could get about 30 percent domestic coal in our coal mix.
24:54 And accordingly, the power cost is lower. And hence, of course, overall cost has come down.
24:59 But that's not the only one. Along with that, we have worked on the consumption norms, improving process efficiencies, consumption efficiencies.
25:06 We have renegotiated all our contracts to reduce contract costs by various mechanisms of either increasing the time period of the contract,
25:14 redefining the scope of the contract, maybe carrying part of the risk on our operations and things like that, which has improved our cost.
25:24 And one of the biggest area of cost reduction also we have worked on is mining with better accuracy so that we don't need so much of mine development.
25:34 And we improve our grade. And every point, 0.5 increase in grade also reduces the cost by a substantial margin.
25:42 So, if you look at the grade wise from something around 6.5 or so, last year we are about 7.3 or 7.4 in the grade of zinc that we are mining.
25:54 So, that also helped us to reduce cost.
25:57 Right. And before we call this a wrap on the show, we all know that on January 22, well, we will have the Pran Pratishtha at the Ram Temple in Ayodhya.
26:09 But the economic opportunities created are witnessing no limits across the country.
26:22 We have Sesha Sen reporting from Delhi on how the traders are making a hay amid these festivities.
26:29 As the date for the Pran Pratishtha Puja in Ayodhya nears, the excitement around Ram Temple is reaching its crescendo.
26:36 It's not just about religion, but business and economy as well.
26:40 While the tourism sector and businesses in Ayodhya are expecting a surge in economic activities, the opportunities created is not just limited to Ayodhya.
26:50 Delhi traders are also making hay while the sun shines, leading to bulk sales of diyas, flags and even miniature models of Ayodhya temples.
27:00 Wholesale traders in the bullion market also claim there is a high demand for silver coins and miniature idols.
27:08 The Confederation of All India Traders body, in fact, has estimated businesses worth Rs. 1 lakh crore, with Delhi alone generating businesses worth over Rs. 20,000 crore in the run-up to the ceremony.
27:20 NDTV Prophet visited markets in Chandni Chowk, Retakail Laj, Khan Market as well as Karol Bagh and spoke to several traders.
27:29 Listen in what they have to say.
27:32 Particularly the trading community is upbeat over organizing various functions, various events and so many other things, which has resulted into a generation of business to the tune of Rs. 1 lakh crore.
27:49 The demand for coins from the Ram Mandir is high, 5 grams, 10 grams, 20 grams, 50 grams and 100 grams.
27:56 We have sold over 1000-2000 kilos worth of coins.
28:00 In a good way, Diwali is here.
28:03 Well, that was the voices coming in from the traders in Delhi who are rejoicing the spillover effect of the business boom in Ayodhya. And sales are expected to escalate further from here, bringing cheer to the small and medium enterprises.
28:20 With camera person Suraj Singh, Sesha Sen for NDTV Prophet.
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29:13 Hello and welcome. You are watching NDTV Prophet. I am Mahima Vachrajani.
29:17 Hats and Agro is on focus today on the backs of Q3 earnings. The numbers look really positive and we have with us Mr. R. G. Chandramohan, Chairman of Hats and Agro with us today.
29:29 Mr. Chandramohan, congratulations on the extremely positive numbers.
29:34 The numbers look quite good operationally. Just wanted to know if they have met your internal expectations.
29:40 Also, we have seen double digit volume growth.
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