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ICAI
PRESENTATION
BY ASHISH CHATURMOHTA,
Director, Sanctum Wealth
Management
Twitter Handle - @AshishChatur
DisclaimerThe following presentation is for educational purpose only, to understand the concept of technical analysis and other studies. We don’tintend anyone to trade or invest based on this educational presentation, nor we are liable for any losses of any decision taken based onthis presentation.
2
Sanctum Wealth Management Private Limited, SEBI (Research Analysts) Regulations 2014, Registration No. INH000003051Sanctum Wealth Management Private Limited (“Sanctum Wealth”) is registered with SEBI as a Stockbroker (corporate member on the Bombay Stock Exchange and National Stock Exchange),Research Analyst, Portfolio Manager, Depository Participant (with NSDL) and is an AMFI registered Mututal Fund Distributor. We hereby declare that our activities were neither suspended norhave we defaulted with any stock exchange authority with whom we are registered in the last five years. We have not been debarred from doing business by any Stock Exchange/SEBI or anyother authorities, nor has our certificate of registration been cancelled by SEBI at any point of time.Sanctum Wealth’s subsidiaries include, (1) Sanctum Wealth Advisors Private Limited which is engaged in the business of providing real estate advisory services and is registered with the RealEstate Regulatory Authority (2) Sanctum Foundation which is a section 8 Company.
Each We, Ashish Chaturmohta, Anway Bhujbal certify that the views expressed in this document are an accurate representation of our personal opinions on the stock or sector as covered andreported on by us herein. We furthermore certify that no part of the analyst's compensation was, is or will be related, directly or indirectly, to the specific recommendations or views asexpressed in this document. recipient of this document should make such investigations as it deems necessary to arrive at an independent evaluation of an investment in the securities ofcompanies referred to in this document (including the merits and risks involved), and should consult its own advisors to determine the merits and risks of such an investment. This document isbeing supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, copied, in whole or in part,for any purpose. This report is 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 otherjurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject Sanctum Wealth and/or its affiliates to any registration orlicensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to a certain category of investors. Persons in whosepossession this document may come are required to inform themselves of and to observe such applicable restrictions. This material should not be construed as an offer to sell or thesolicitation of an offer to buy any security in any jurisdiction where such an offer or solicitation would be illegal.
Sanctum Wealth makes no representation or warranty, express or implied, as to the accuracy, completeness or fairness of the information and opinions contained in this document. SanctumWealth its affiliates, and the employees of Sanctum Wealth and its affiliates may, from time to time, effect or have effected an own account transaction in, or deal as principal or agent in orfor the securities mentioned in this document. They may perform or seek to perform services for, or solicit business from, any company referred to in this report.
This report has been prepared on the basis of information, which is already available in publicly accessible media or developed through an independent analysis by Sanctum Wealth. While wewould endeavour to update the information herein on a reasonable basis, Sanctum Wealth and its affiliates are under no obligation to update the information. Also, there may be regulatory,compliance or other reasons that prevent Sanctum Wealth and its affiliates from doing so. Neither Sanctum Wealth nor its affiliates or their respective directors, employees, agents orrepresentatives shall be responsible or liable in any manner, directly or indirectly, for views or opinions expressed in this report or the contents or any errors or discrepancies herein or for anydecisions or actions taken in reliance on the report or the inability to use or access our service in this report or for any loss or damages whether direct or indirect, incidental, special orconsequential including without limitation loss of revenue or profits that may arise from or in connection with the use of or reliance on this report.
Sanctum Wealth and/or its affiliates and/or employees may have interests/positions, financial or otherwise in the securities mentioned in this report. To enhance transparency, SanctumWealth has incorporated a disclosure of interest statement in this document. This should however not be treated as endorsement of views expressed in this report.
Products and services, other than Broking products and services e.g. Research Reports are not exchange traded products. Disputes relating to the research activities of Sanctum Wealth do nothave access to exchange investor redressal or Arbitration mechanism. For any grievances, please write to grievance@sanctumwealth.com.
Other Registrations:SEBI (Portfolio Mangers) Regulations 2020, Registration No. INP000005067SEBI (Depositories and Participants) Regulations, 1996, Registration No. IN-DP-248-2016SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992, Registration No. INZ000011338Association of Mutual Fund in India (AMFI) ARN: 105768
Technical
Analysis
4
Top Down Analysis➢ Monthly➢ Weekly➢ Daily
Identify Market Structure➢ Patterns➢ Support & Resistance➢ Long term Trendline➢ Volume and Delivery activity
How to Identify Long Term Trends
5
➢ Bullish Patterns: Rounding bottom, Multi year breakout, Double Bottom, Inverted Head & Shoulders Pattern, Pole and Flag, etc
➢ Fibonacci retracement ratios
➢ Pickup in volumes and delivery %
➢ Institutional & HNI activity - Increase in Bulk & Block deal
➢ Comparative strength vs Peers vs Sectors vs Benchmark
➢ Liquidity, Index inclusion, Portfolio Concentration
➢ Buy Value stocks only once momentum sets in otherwise stuck in consolidation
➢ Stop loss either on time or particular % correction whichever is earlier depending on market cap
➢ Small Cap - Art of Exit
Top Down AnalysisMonthly
M05 N M06 N M07 N M08 N M09 N M10 N M11 N M12 N M13 N M14 N M15 N M16 N M17 N M18
3500
3400
3300
3200
3100
3 T
2900
2800
2700
2600
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2400
2300
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2 T
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1700
1600
1500
1400
1300
1200
1100
1 T
900
800
700
600
500
400
300
200
100
-100
-200
-300
-400
8 C
6 C
4 C
2 C
4-BAJAJ FINANCE LIMITED - 12/12/19 F7
Monthly
QtyLine
Long term uptrendHigh top High Bottom formation
Rising Trendline support
Previous high acts as support
NBFC Crisis
Price 2400
Top Down AnalysisWeekly
N F12 M J O J13 A J S D M14 M A N F15 A J O J16 A J S D M17 M A N F18 A J O
3500
3400
3300
3200
3100
3 T
2900
2800
2700
2600
2500
2400
2300
2200
2100
2 T
1900
1800
1700
1600
1500
1400
1300
1200
1100
1 T
900
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700
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500
400
300
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100
-100
-200
-300
3 C
250 L
2 C
150 L
1 C
50 L
4-BAJAJ FINANCE LIMITED - 12/12/19 F7
Weekly
Avg(CloseLine:S:50)
QtyLine
50 week moving average support
Price 2400
Top Down AnalysisDaily
28 D 18 28 J18 17 29 F 19 28 M 21 A 12 23 M 14 23 J 12 21 J 11 20 31 A 21 31 S 24 O 15 25
3200
3150
3100
3050
3 T
2950
2900
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2800
2750
2700
2650
2600
2550
2500
2450
2400
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2300
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2200
2150
2100
2050
2 T
1950
1900
1850
1800
1750
1700
1650
1600
1550
1500
1450
1400
1350
1300
1 C
80 L
60 L
40 L
20 L
1-BAJAJ FINANCE LIMITED - 12/12/19 F7
Daily
QtyLine
Double Bottom
High volumes Accumulation
Price 2400
Top Down AnalysisMonthly - Current
High 6430
2400
High 4868
Patterns
Rounding Bottom
11
M J J A S O N D J16 F M A 29 M J J A S O N D J17 F M 31 A M J J A S O N D J18 F M 28 A M J J A S
530
520
510
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390
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370
360
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210
200
4 C
350 L
3 C
250 L
2 C
150 L
1 C
50 L
426.45
1-Dabur India Ltd. - 31/07/19 F7
Weekly
QtyLine
Breakout
Breakout Volume
320
260
Height =320-260=60
Target = 320 + 60 = 380
Retest of breakout level
Cup and Handle
12Source: Falcon7
N D J10 M A M J J A O N D J11 F M A J J A S O N D F12 M A M J J A O N D J13 F M M J J A S O N J14 F M A
540
530
520
510
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460
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430
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400
390
380
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110
100
90
80
70
5 C
4 C
3 C
2 C
1 C
1-TECH MAHINDRA LIMITED - 29/07/19 F7
Weekly
QtyLine
CUP
HANDLE
Neckline
Low 120
Breakout @290
Height=290-120=170
Target = 290+170 =460
Breakout onHigh volumes
Double Bottom
13
S O N D J15 F M A M J J 31 A S O N D J16 F M A M J J 29 A S O N
660
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640
630
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590
580
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540
530
520
510
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360
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310
300
290
280
270
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250
240
230
220
16 C
14 C
12 C
10 C
8 C
6 C
4 C
2 C
1-Tata Motors Limited - 29/07/19 F7
Weekly
QtyLine
Neckline
Botto m#1
430
280
Botto m#2
Momentum Breakout
High volume on Breakout
Height =430-280 =150
Target = 430+150 = 580
A M J J A S O D J16 F M A M J A S O N D J17 M A M J J A S N D
880
860
840
820
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780
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520
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460
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400
380
360
120 L
1 C
80 L
60 L
40 L
20 L
1-BATA INDIA LTD. - 26/07/19 F7
Weekly
QtyLine, Avg(QtyLine:S:10)
Bullish/Inverted Head and Shoulders
Source: Seediff
14
Neckline
Right Shoulder
Head
Left Shoulder
BreakoutHeight =605-400 =205
Target = 585+205 =790
Volumes on breakout
Ascending Triangle
15
A S 26 O N 28 D J15 30 F M A 24 M J 26 J A 28 S O 30 N D J16 22 F M 23 A M 27 J J 29 A S 30 O
1260
1240
1220
1200
1180
1160
1140
1120
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1080
1060
1040
1020
1 T
980
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900
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640
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560
540
140 L
120 L
1 C
80 L
60 L
40 L
20 L
1-ASIAN PAINTS LIMITED - 29/07/19 F7
Weekly
QtyLine
Resistance line 920
700
Height =220
Target = 920 + 220 = 1140
Momentum Breakout
Volume Breakout
Rectangle
16N J14 M M J A O D F15 A M J S N J16 M A J A O D F17 M M J S N J18 M A J A
1900
1850
1800
1750
1700
1650
1600
1550
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1450
1400
1350
1300
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1200
1150
1100
1050
1 T
950
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200
150
100
35 L
30 L
25 L
20 L
15 L
10 L
5 L
1-Info Edge (India) Limited - 02/08/19 F7
Weekly
QtyLine
Consolidation
1000
700
Height =300
Target = 1000 + 3000 = 1300
Momentum Breakout
Volume Breakout
Up move
Resumption of uptrend after consolidation
Bullish Falling Wedge
17
M J J A S O N D J07 F M 30 A M J J A S O N D J08 F 29 M A M J J A S O N D J09 30 F M A M J J A S O
400
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90
7 C
6 C
5 C
4 C
3 C
2 C
1 C
1-HDFC Bank Ltd. - 31/07/19 F7
Weekly
QtyLine
Breakout
Target = High of wedge
Higher Volume
Pole & Flag Pattern
J19 03 07 09 11 15 17 21 23 25 29 31 F 06 08 12 14 18 20 22 26 28 M 07 11 13 15 19 22 26 28 A 03 05 09 11 15
530
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510
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350 T
3 L
250 T
2 L
150 T
1 L
50 T
1-Kalpataru Pow Trans Ltd - 01/07/19 F7
Daily
QtyLine
POLE
80 points
490 Target
FLAG
80 points410
330
Up move
Consolidation
Up move
Rising Channel
24 S 21 O 19 N 16 30 D 28 J19 25 F 22 M 22 A 18 M 17 31 J 28
1440
1420
1400
1380
1360
1340
1320
1300
1280
1260
1240
1220
1200
1180
1160
1140
1120
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1080
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1020
1 T
980
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840
820
800
780
760
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720
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250 L
2 C
150 L
1 C
50 L
1290.35
1-TITAN COMPANY LIMITED - 04/07/19 F7
Weekly
QtyLine, DelQtyLine
Support
Resistance
Support
Resistance
Resistance
Resistance
Be opportunistic
20
• Universal Cables – M – Line chart
• Vol – smart
• Avenue – Future Retail - Vmart
21
Two year consolidation
Volume
Higher the consolidation, the better..
38%
22
530%
• Page Industries
• Britannia
• KEC
23
160Breakout
Multi year high breakout
• Page Industries
• Britannia
• KEC
24
110%
Breakout
25
➢ Good Business – Pricing power & Competition, Sectoral Tailwind, Entry Barrier, Brand, Reputation Government Dependency, Industry Size, Innovation, Strategic Assets
➢ Good Management – High Corporate Governance, Strong Parentage, Promoter Holding, Focus of Management (Z,E), Pledge
➢ Political Connection
➢ Capital Intensity and Capital Efficiency of Industry
➢ Debt Levels – Avoid highly leveraged B/S, Low interest coverage ratio
➢ Increasing working capital cycle is concern, Cash conversion cycle
➢ Operating profit to convert into Cash Flow from Operations (50%)
➢ Consistency in Revenue and PAT growth
➢ Good reasonable ROC and ROCE
➢ ROCE (10 year G-Sec Yield + Long term Equity Premium) > 15%
➢ Ten year cycle – Upcycle Downcycle
➢ Revenue Growth, EBITDA and PAT growth
➢ Sector tailwind
➢ Revenue growth 10% for a decade, nominal GDP growth 14.5%.
➢ ROCE – EBIT/Capital Employed (ROCE > WACC)
➢ CAGR in Auditor renumeration vs CAGR in consolidated Revenue
Fundamentals
Recent
Case Studies
Financialization of Savings
➢ Indians have a habit of saving, but the bulk of household savings has been traditionally allotted to physicalassets like real estate and gold. An average Indian household holds 84% of its wealth in real estate and otherphysical goods, 11% in gold and the residual 5% in financial assets.
➢ Post demonetization in 2016, parallel economy (commonly known as black money) circulation came tostandstill, thereby hampering assets like Gold and Real-estate. This further got traction with GST in 2017 andsince then various asset classes have attracted investors. Post, 2017, savings started being converted into otherfinancial assets in a big way.
➢ The intensity of the trend in favor of financial assets can be gauged by the fact that the Assets UnderManagement (AUM) of the Indian mutual fund industry touched 32 trillion rupees in April, growing over four-fold in the last 10 years.
➢ Further, it is estimated that, in India, 1.25 crore people will turn 25 every year in India for the next 7 years,which will lead to further traction.
➢ Owing to the same, the following Industries are being benefited –➢ Broking Industry➢ Exchanges➢ Registrar & Transfer Agents
Brokerage Industry
➢ Rising Retail Participation
➢ Increasing Share of Internet and Mobile Trading
➢ Increasing Depository Accounts
➢ Institutional Investment into Equities
➢ Full Service Brokerages Continue to Maintain Market leadership
➢ Largest Equity Broker in India Powered by Proprietary Technology Platform
➢ Natural Beneficiary of Fundamental Transformation in the Indian Savings Environment
➢ Strong and growing distribution business :- third-party mutual funds, insurance products, fixed deposits, loansand pension products to its retail customers for commission income
➢ Superior Customer Experience through Product and Technology Innovation
➢ ICICI Group ecosystem, it has mutually beneficial agreements with various companies in the ICICI Group. ‘3-in-1 account’ facility linked to ICICI Bank savings and demat accounts.
➢ ICICI Sec’s growing investment banking business offers equity capital markets services and other financialadvisory services to corporate clients, the government and financial sponsors
➢ Strong Financial Performance with Significant Operating Efficiency
ICICI Securities
27 J 21 J 17 30 A 27 S 24 O 23 N 19 D 13 27 J20 22 F 14 28 M 26 A 27 M 22 J 18 J 14 27 A 20 S 15 28 O 23 N 18 D 15 29 J21 22 F 18 M 17 31 A
570
560
550
540
530
520
510
500
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480
470
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450
440
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390
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210
200
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120 L
1 C
80 L
60 L
40 L
20 L
1-Icici Securities Limited - 30/07/21 F7Net
Daily
QtyLine, DelQtyLine, Avg(QtyLine:S:10)
9 months of correction
ICICI Securities
F 12 24 M 16 25 A 20 29 M 20 J 10 19 30 J 20 29 A 18 27 S 16 25 O 16 27 N 14 25 D 16 28 J21 15 27 F 16 25 M 18 30 A 22 M 12 24 J 11 22 J 12
800
780
760
740
720
700
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560
540
520
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460
440
420
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380
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340
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260
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220
200
120 L
1 C
80 L
60 L
40 L
20 L
725.00
1-Icici Securities Limited - 30/07/21 F7Net
Daily
QtyLine, DelQtyLine, Avg(QtyLine:S:10)
Crossing of trendline indicating correction is over
ICICI Securities
Breakout
Volumes
Moved from 450 to 80078% in 3 months
Registrars & Transfer Agents
➢ Registrar help to facilitate holding of dematerialized securities enabling securities transactions to beprocessed by book entry.
➢ Transfer agents are the trusts or institutions that register and maintain detailed records of the transactionsof investors for the convenience of mutual fund houses
Central Depositary Services Limited (CDSL)
Computer Aided Management Systems (CAMS)
➢ It is promoted by the Bombay Stock Exchange. It has 20,667 DP Locations/service centers. It has a higherstockbroker base that trades more frequently and tends to benefit more in the rising markets vs NSDL, asclients trade more often. It works exclusively with some online brokers like Zerodha
➢ Computer Age Management Services Limited (CAMS) is a Mutual Fund Transfer Agency to the Indian AssetManagement Companies with a share of ~ 70% of the assets under management
CDSL v/s NSDL
• The cost of setting up a DP account with CDSL is more attractive than that with NSDL.
• The minimum net requirement for starting a DP account with CDSL is Rs.2 crores Vs Rs.3 crores for NDSL
• CDSL has a centralized server model that requires no upfront investment Vs setting up on-premise servers to connect to NSDL.
• Deposit requirement for CDSL is 50Lakhs, half of NSDL’s requirement of Rs1crore.
• CDSL offers a Tariff based on Slab System vs Fixed rate structure for NSDL.
• The difference in end customer for both CDSL & NSDL.
CDSL
J A S O N D J18 F M A M J 29 J A S O N D J19 F M A M 31 J J A S O N D J20 F M A 30 M J J A S O N
560
550
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9 C
8 C
7 C
6 C
5 C
4 C
3 C
2 C
1 C
D
D
D
1-Central Depository Servic - 28/07/21 F7Net
Weekly
QtyLine, DelQtyLine, Avg(QtyLine:S:10)
Rounding bottom over 3-years
Breakout level
Consolidation at breakout
Particulars Q3FY21 Q3FY20 Q4FY21 Q4FY20
Revenue 69 42 79 45
EBITDA 46 32 52 26
EBITDA % 67% 23% 65% 42%
PAT 56 14 56 21
Stock has absorbed post IPOselling and its hit new high
CDSL
J A S O N D J18 F M A M J 29 J A S O N D J19 F M A M 31 J J A S O N D J20 F M A 30 M J J A S O N D J21 F M A 30 M J J
1550
1500
1450
1400
1350
1300
1250
1200
1150
1100
1050
1 T
950
900
850
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550
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450
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300
250
200
9 C
8 C
7 C
6 C
5 C
4 C
3 C
2 C
1 C
1329.35
D
D
D
1-Central Depository Servic - 28/07/21 F7Net
Weekly
QtyLine, DelQtyLine, Avg(QtyLine:S:10)
Moved from 500 to 1550210% in 8 months
Breakout level
CDSL
Computer Aided Management Systems (CAMS)
06 07 08 09 12 13 14 15 16 19 20 21 22 23 26 27 28 29 30 N 03 04 05 06 09 10 11 12 13 14 17 18 19 20 23 24 25 26 27 D 02 03 04 07 08 09 10 11 14 15 16 17
1530
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6 L
5 L
4 L
3 L
2 L
1 L
D
1-Cams - 28/07/21 F7Net
Daily
QtyLine, DelQtyLine, Avg(QtyLine:S:10)
Cup and handle pattern10 weeks consolidation
Breakout level
Consolidation at breakout
Stock has absorbed post IPOselling and its hit new high
Computer Aided Management Systems (CAMS)
09 15 21 27 N 06 12 18 24 D 07 11 17 23 30 J21 11 15 21 28 F 09 15 19 25 M 09 16 22 26 A 09 16 23 29 M 11 18 24 28 J 09 15 21 25 J 07 13 19 26
3700
3600
3500
3400
3300
3200
3100
3 T
2900
2800
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2200
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2 T
1900
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1300
20 L
15 L
10 L
5 L
3169.30
D
D
D
1-Cams - 28/07/21 F7Net
Daily
QtyLine, DelQtyLine, Avg(QtyLine:S:10)
Moved from 1500 to 3700147% in 8 months
Breakout level
Particulars Q3FY21 Q3FY20 Q4FY21 Q4FY20
Revenue 180 167 189 164
EBITDA 72 64 79 71
EBITDA % 40% 39% 43% 43%
Computer Aided Management Systems (CAMS)
Exchanges
➢ Exchanges are mediums through which a buyer and seller executes a transaction on a stock exchange. In theIndia Markets, 2 exchanges namely Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) arewidely used.
Bombay Stock Exchange (BSE)
➢ BSE has Derivative market share - 4%, Currency derivatives market share - 34-40% and Cash market share- 5.9%* , have high chances of coming on a growth trajectory soon.
➢ Bse has net cash of approx 1700 crores (~ 30% of Market Cap)(excluding clearing cash)➢ BSE holds 20% stake in CDSL, valuation of which comes to INR 2000 cr (After Holding co. discount)➢ New initiative like insurance, spot exchange and Inx are promising* but determining revenue at this point
of time from these platforms are difficult. However, these new launches clearly indicates the desire toexpand.
➢ Debt market offerings like Star MF portfolio are giving them a spot light in the Debt market.
M 31 A M J J A S O N D J18 F M 28 A M J J A S O N D J19 F M 29 A M J J A S O N D J20 F 28 M A M J J A S O N D
1200
1180
1160
1140
1120
1100
1080
1060
1040
1020
1 T
980
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900
880860
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340320
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260
140 L
120 L
1 C
80 L
60 L
40 L
20 L
1-Bse Limited - 30/07/21 F7Net
Weekly
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Bombay Stock Exchange (BSE)
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1-Bse Limited - 30/07/21 F7Net
Weekly
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Particulars Q3FY21 Q3FY20 Q4FY21 Q4FY20
Revenue 158 150 165 150
EBITDA 39 18 50 8
EBITDA % 25% 12% 30% 6%
Bombay Stock Exchange (BSE)
Digitalization
➢ Indian technology services could reach USD 300-350 billion in revenues by 2025➢ Values at roughly USD 1 trillion today, it is now among the biggest contributors to economic growth around the
world and especially in India—the industry now produces about 27% of the nation’s exports and provideslivelihoods for about 4.4 million people.
➢ 5% of the world’s largest companies, spend close to 6% of their revenues on technology. They have grown inmarket capitalization by an average of about 22% annually since 2015 and will represent an increasingly largeshare among global majors in the future.
➢ 70% of the world’s largest companies, spend only about 3% of revenues on technology; their marketcapitalization has declined by an average of about 2% since 2015. However post covid things have turnedupside down.
➢ Annual decline in global spending on traditional technology is likely to accelerate from 3-4% today to 8 to 10%,and the share of traditional services in India’s tech services revenues will likely fall from 70-72% to 40-45% by2025.
➢ Happiest Minds is a different IT company because 97% of the revenues are coming from digital whereas traditional ITcompanies get 30-50% from digital.
➢ The average cost per employee is much lower for Happiest Minds as compared to the global giants.
➢ It has 173 client and 87% of the business is repeat business. Over the last several years, ROE and ROCE has been wellabove 25%.
➢ The company has increased its utilization rate from 68% in FY18 to 83% in FY21.
Twitter Handle - @AshishChatur
Happiest Minds
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Happiest Minds
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Q3FY21 Q3FY20 Q4FY21 Q4FY20
Revenue 193 172 221 186
EBIDTA 51 24 56 22
EBIDTA % 27% 14% 25% 12%
Happiest Minds
persistentQ3FY21 Q3FY20 Q4FY21 Q4FY20
Revenue 1075 923 1113 926
EBIDTA 182 124 188 127
EBIDTA % 17% 13% 17% 14%
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Persistent
Q3FY21 Q3FY20 Q4FY21 Q4FY20
Revenue 1075 923 1113 926
EBIDTA 182 124 188 127
EBIDTA % 17% 13% 17% 14%
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Tata Elxsi
Breakout level
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Tata Elxsi
Q3FY21 Q3FY20 Q4FY21 Q4FY20
Revenue 477 423 558 439
EBIDTA 144 94 168 109
EBIDTA % 30% 22% 32% 25%
➢ Steel is major component when It comes to Infrastructure development. Post covid, to normalize theeconomy, various countries announced various large infrastructure projects to create demand..
➢ China is the largest manufacturer and the largest consumer of Steel globally. Due to its largeoperations China supplied more than it produced. However, in order to support the Chineseeconomy, governments massive spend on infrastructure lead to China being a net importer of steelfrom a net exporter. This led to massive demand globally.
➢ China’s recent policies 1) No increase in Steel production for 2021 vs 20, 2) Reduction in Utilization inTangshan to control emissions, 3)Crackdown on Sintering / Coking in Shanxi: 4) Ultra low EmissionOnly 16 of 250+ achieved till date; 5) Removal of exports tariffs 6) Imposing of fresh restrictions
➢ Owing to the same, Indian companies have reported stellar numbers and repaid huge amount ofdebt in the last FY.
STEEL
Twitter Handle - @AshishChatur
J08 A J O J09 A J O D A10 J O D A11 J S D M12 J S D M13 J S D M14 J S D M15 J S D M16 J S D M17 J S D M18 J S D M19 J S D M20 J S
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1-Tata Steel Limited - 28/07/21 F7Net
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Major multi year consolidation since 2008
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Tata Steel
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1-Tata Steel Limited - 28/07/21 F7Net
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Tata Steel
Crossed major falling trendline
Q3FY21 Q3FY20 Q4FY21 Q4FY20
Revenue 41902 35520 49977 36009
EBIDTA 9568 3557 14184 4799
EBIDTA % 23% 10% 28% 13%
Crossed major falling trendline
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Sail
2-year decline
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➢ Sugar is a commodity item, the prices of which are a result of demand and supply.India is the second-largest producer of sugar. It contribute about 20% to the globalsupply. There are over 530 sugar mills in the country, but a significant chunk ofsugar production (80%) happens in UP, Maharashtra, and Karnataka.
➢ While producing sugar from sugarcane juice, molasses turns out to be a byproduct, which can be later used coproduce ethanol.
➢ Taking in numbers, one tonne of cane, mills can produce 115 kg of sugar (at 11.5%recovery) and 45 kg of molasses (18 kg) that gives 10.8 litres of ethanol.
➢ Goverment's latest step to increase ethanol blending into petrol due to rising fuelprices, will give a push to sugar industry.
➢ Hence, with this the margins of sugar companies are expected to touch mid teensfrom mid single digits.
➢ Prime minister Narendra Modi announced June 5, 2021 the target of 20% ethanolblended petrol has been advanced by five years to 2025
B. SUGAR
Twitter Handle - @AshishChatur
Breakout levelBalrampur Chini
Major multi year consolidation since 2006Between 200-30
Moved from 200 to 37085%
Breakout level
Balrampur Chini
AFFLE
➢ Affle India Ltd is an ad tech company that helps advertisers drive useracquisition, improve engagement and increase the frequency oftransactions through mobile advertising using its proprietary consumerplatform.
➢ The share of digital ads in media budgets across industries is increasing.Players with scalable end-to-end offerings across the ad-tech valuechain, such as Affle, should be a beneficiary of the internet wave anddigital expansion.
➢ Affle provides end-to-end automated mobile advertising consumer platform, coupled with a cost per converted user (CPCU) model, drives ROI and ensures high client retention and strong network effects.
➢ Filed 14 patents in Singapore and the USA to fortify AI-driven intelligence & automation for conversion-driven marketing with key focus on conversational, vernacular and voice based intelligence.
Profit & Loss
Rs cr FY18 FY19 %
Revenue 167.2 249.4 49%
EBITDA 45.5 70.3 55%
EBIT 37.2 60.2 62%
Profit 27.8 48.8 76%
Breakout level
Praj Industries
Major multi year base formation since 2008 at lower levels
High volumes at lower levels
M06 J N M07 J N M08 J N M09 J N M10 J N M11 J N M12 J N M13 J N M14 J N M15 J N M16 J N M17 J N M18 J N M19 J N M20 J N M21 J
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1-Praj Industries Ltd - 30/07/21 F7Net
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Breakout level
Praj Industries
AFFLE
Key Investors in parent company
Shareholding Pattern
as of Sep 2019
as of Sep 2019
Public shareholding >1%
AFFLE
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1-AFFLE (INDIA) LIMITED - 10/12/19 F7
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AFFLE
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1-AFFLE (INDIA) LIMITED - 10/12/19 F7
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AFFLE
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6285
Polycab India
➢ Demonetization and the introduction of GST have increased the pace at which the shift from the unorganizedto the organized is taking place. According to industry data, the share of the unorganized players has fallenfrom ~39% in FY14 to ~34% in FY18 and is expected to correct further to ~26% by 2023.
➢ Polycab has a robust network of dealers and distributors, which will enable it to capture this shift from theunorganized players extremely efficiently.
➢ Sustained investments in FMEG over FY14-21E (a third of overall capex) will help the company ramp uprevenue market share from ~1% currently to ~3% (~4x growth in revenues) over the next three-four years withsignificant operating margin ramp up potential.
➢ C&W industry is INR600bn plus (in FY19) has posted volume/value CAGR of 21%/12% over the same period.
➢ Polycab is taking several initiatives—channel financing, better inventory management, among others—toimprove cash flow which will gradually spur free cash
➢ ROCE has improved 700bps to ~21% over FY15-19.
Polycab India
Polycab has attained this market leadership riding following strategies:
➢ Sustained annual capex (higher than peers) to have the largest manufacturing capacity.
➢ Focus on availability of products (reflected in higher inventory days) with fast TAT.
➢ Strong dealer network penetration—Project Bandhan, Project Josh.
➢ High advertisement expenses to create brand pull, particularly for wires.
Polycab India
C&W industry market share is highly concentrated
Polycab - Largest C&W player, revenue 2x second largest player
Institutional and HNI activity
70
➢ Increase in Bulk and Block deal activity
➢ Institutional Investors/Analyst Meet
Polycab India
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1-POLYCAB INDIA LIMITED - 10/12/19 F7
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1-POLYCAB INDIA LIMITED - 10/12/19 F7
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Rs. Crores Sep-18 Sep-19 %
Sales 1812 2242 24%
Operating Profit 213 270 27%
PBT 139 230 65%
Net Profit 89 192 116%
Quarterly Result
M
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Thank You
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Gujarat Gas
➢ Pollution Control Measures to Drive PNG Industrial Volume Growth - National Green Tribunal (NGT) hasidentified 38 critically polluted areas, and directed all state pollution control boards to finalise a time-boundaction plan to bring all such industrial clusters within the safe parameters.
➢ About 38% of Delhi Mumbai Industrial Corridor which is expected to >60% of investment.
➢ The Govt. of Gujarat in co-operation with Guj Gas and Sabarmati Gas launched CNG Sahbhagi Yojana to set up214 CNG stations across the state at the cost of Rs8bn. The Gujarat Government has handed over Letter ofIntent (LOI) to the 214 dealers for setting up CNG stations
➢ Global LNG prices continue to remain under pressure owing to higher LNG supply, which rose by ~30mmt YoYto 240mmt in CY19 YTD. In GUJGA’s sourcing-mix, LNG accounted for 77%, while lower LNG prices led to rise inEBITDA/scm to Rs5.0 in 1HFY20.
Income Statement Shareholding Pattern
Gujarat Gas
Share of Gujarat Gas in India’s industrial PNG consumption
Gujarat Gas pipeline network and operating area
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1-GUJGASLTD - 12/12/19 F7
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Gujarat Gas
Accumulation
Rs. Crores Sep-18 Jun-19 Sep-19 % QoQ % YoY
Sales 1964 2615 2513 -4% 28%
Operating Profit 161 466 371 -20% 130%
PBT 58 360 261 -28% 350%
Net Profit 41 234 517 121% 1161%
Volume (mmscmd) 6.7 9.2 9.3 1% 39%
Quarterly Result
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Abbott India
➢ Abbott India is the fastest growing listed MNC pharma company. It has outperformed the industry on aconsistent basis in women’s health, gastrointestinal, metabolic, pain, central nervous system and vaccines.
➢ Abbott’s strong growth track in power brands and capability of new launches on a fairly consistent basis (100products in the last 10 years)
➢ The company’s top 10 brands (power brands) together registered a revenue CAGR of ~17% in September 2015-19
➢ Access to innovative molecules from global parent to drive growth
➢ EBITDA margins have recovered from the lows of 11.8% in FY14 (adjusted) due to inclusion of one its top brand(Thyronorm) under price control (NLEM) to 18.4% in H1FY20.
➢ Recent tax amendments have the effect of reducing the company’s tax rate from 36% in FY19 to 25.2% fromFY20 onwards.
➢ Abbott India is a debt-free company and has seen its core RoEs improving from 72% in FY14 to 126% in FY19
Growth
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Abbott India
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Abbott India
Brokerage Industry
➢ Rising Retail Participation
➢ Increasing Share of Internet and Mobile Trading
➢ Increasing Depository Accounts
➢ Institutional Investment into Equities
➢ Full Service Brokerages Continue to Maintain Market leadership
➢ Largest Equity Broker in India Powered by Proprietary Technology Platform
➢ Natural Beneficiary of Fundamental Transformation in the Indian Savings Environment
➢ Strong and growing distribution business :- third-party mutual funds, insurance products, fixed deposits, loansand pension products to its retail customers for commission income
➢ Superior Customer Experience through Product and Technology Innovation
➢ ICICI Group ecosystem, it has mutually beneficial agreements with various companies in the ICICI Group. ‘3-in-1 account’ facility linked to ICICI Bank savings and demat accounts.
➢ ICICI Sec’s growing investment banking business offers equity capital markets services and other financialadvisory services to corporate clients, the government and financial sponsors
➢ Strong Financial Performance with Significant Operating Efficiency
ICICI Securities
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ICICI Securities
SRF Ltd
➢ A clampdown on chemical manufacturing, tightener pollution control norms and the threat of US tariffs inChina caused disruption
➢ Indian specialty chemicals were the beneficiary
➢ Turnaround in specialty chemicals
➢ Dominant position in the market with largest market share
➢ Market leadership position in Nylon Tyre Cord Fabrics
➢ The company doubled its Hydroflurocarbon capacity to 50,000MT with an investment of INR3,800m
General Insurance
➢ General insurance industry (GI Ind), which has a size of Rs 1.70 tn on a GDPI basis as of FY19, offers financialprotection for motor, health, crop, fire, and marine, to various categories of customers such as retail, corporateand government.
➢ Significant under penetration of non-life insurance market – India’s general insurance penetration is one of thelowest among BRICS countries, offering ample opportunities in the near term
➢ Structural shift in market share away from State owned insurers – public sector companies dominate thesector
➢ India, as a country offers immense growth opportunities for non-life insurance sector, owing to the favorabledemographic dividend (with 65% of the population below the age of 35), and lower penetration at around1.2% of GDP (calculated), as against a world average of 2.78% (in CY17 according to Sigma 2018 Swiss report).
➢ The industry has shown strong growth in last few years (CAGR of 19% over FY15-19), owing to the expansion ofthe associated industries (likeautomobile & healthcare) and the introduction of new products coveringmiscellaneous risks associated with the current market scenario.
20 M 15 27 A 20 M 15 25 J 18 28 J 20 A 13 27 S 19 O 15 26 N 20 D 13 26 J19 17 29 F 20
2600
2550
2500
2450
2400
2350
2300
2250
2200
2150
2100
2050
2 T
1950
1900
1850
1800
1750
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1500
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20 L
15 L
10 L
5 L
1-SRF Ltd. - 12/12/19 F7
Daily
QtyLine
2250
Double Bottom
SRF Ltd
High volumesDouble bottom
High volume
1st low
2nd low
A M 25 J J 19 A 28 S O 26 N D 24 J19 30 F M 28 A M 28 J J 23 A 30 S O 31 N D
3600
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3450
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3200
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3 T
2950
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2800
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2250
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2150
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2050
2 T
1950
1900
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1750
1700
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1450
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1350
1300
30 L
25 L
20 L
15 L
10 L
5 L
3309.15
1-SRF Ltd. - 12/12/19 F7
Daily
QtyLine
2250
3323
48% in 9 months
SRF Ltd
“When do you want get diagnosed?”
91
D J17 F M A M J A S O N D J18 M A M J J A S N D J19 F M A M J A S O N
10800
10600
10400
10200
10 T
9800
9600
9400
9200
9 T
8800
8600
8400
8200
8 T
7800
7600
7400
7200
7 T
6800
6600
6400
6200
6 T
5800
5600
5400
5200
5 T
4800
4600
4400
4200
4 T
1 C
80 L
60 L
40 L
20 L
7090.00
1-Maruti Suzuki India Ltd - 13/12/19 F7
Weekly
QtyLine
Maruti Suzuki
10,000
Breakdown confirmation
Reversal signal 8600
8,250
Double Top
COLD
FEVER
cmp 7090
Edelweiss Financial Services
23 J 26 J 30 A S 24 O 30 N D 21 J19 25 F 28 M A 25 M 31 J J 23 A 28 S O 24 N 28
380
370
360
350
340
330
320
310
300
290
280
270
260
250
240
230
220
210
200
190
180
170
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150
140
130
120
110
100
90
80
70
60
50
40
30
140 L
120 L
1 C
80 L
60 L
40 L
20 L
114.50
1-Edelweiss Financial Servi - 13/12/19 F7
Daily
QtyLine
270
Breakdown
Consolidation
Resumption of downtrend
Volumes on declines
Support now acting as Resistance
206
COLDFEVER
ICU
cmp 115
Technical Analysis = Brahmastra
Art of exiting :
Arjun vs Abhimanyu
In Smallcap/high beta/fancy names/ new flavours/topnewsmakers you have to be Arjun not Abhimanyu
Who am I?
Vakrangee
J 17 25 A 10 21 30 S 15 25 O 12 23 31 N 16 24 D 12 20 29 J18 16 24 F 12 21 M 12 20 28 A 17 25 M 14 22
520
500
480
460
440
420
400
380
360
340
320
300
280
260
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220
200
180
160
140
120
100
80
60
40
20
6 C
5 C
4 C
3 C
2 C
1 C
34.00
2-VAKRANGEE LIMITED - 21/06/19 F7Net
Daily
QtyLine
In uptrend forming high forming higher tops and higher bottoms
364
False HopeFrom low recovery of 15%
High Volumes
Further confirmation
Now less than 10th value cmp 34
High 515
PC Jeweller
25 O 18 31 N 22 D 14 27 J18 18 31 F 23 M 20 A 13 25 M 18 30 J 21 J 13 25 A 17 30 S 25 O
620
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420
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380
360
340
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300
280
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180
160
140
120
100
80
60
40
22 C20 C
18 C16 C14 C
12 C10 C8 C
6 C4 C2 C
52.05
2-PC JEWELLER LIMITED - 21/06/19 F7Net
Daily
QtyLine
In uptrend forming high forming higher tops and higher bottoms
Close 364
Intraday From low recovery of 67%
Highest volumes for the stock
cmp 52
High 600
Infibeam Avenues
16 26 A 13 23 M 10 18 28 J 13 21 29 J 17 25 A 10 21 30 S 18 27 O 16 25 N 13 21 30 D
250
240
230
220
210
200
190
180
170
160
150
140
130
120
110
100
90
80
70
60
50
40
30
20
14 C
12 C
10 C
8 C
6 C
4 C
2 C
45.15
2-INFIBEAM AVENUES LIMITED - 21/06/19 F7Net
Daily
QtyLine
Recovery from 140 to 225. But failed to move above the highs
First signal
cmp 45
High 242
“Avoid falling knives”
99
Stockholm syndrome
100
“is when kidnapped falls in love with kidnapper. Holding to dicey stocks where promoter ethics is hazy is exactly the same thing. Averaging it when it crashes is one step ahead – actually marrying the kidnapper”
DHFL
M 21 J 14 27 J 23 A 17 31 S 28 O 26 N 22 D 19 J19 15 28 F 21 M 20 A 16 M 16 29 J
800
780
760
740
720
700
680
660
640
620
600
580
560
540
520
500
480
460
440
420
400
380
360
340
320
300
280
260
240
220
200
180
160
140
120
100
80
60
40
20
-20
12 C
10 C
8 C
6 C
4 C
2 C
73.20
580.44
680.27
1-DEWAN HOUSING FINANCE - 21/06/19 F7
Daily
QtyLine, Avg(QtyLine:S:10), DelQtyLine
580
60% recovery from low of 274 to 438 next day
Consolidation
Huge Volumes on declines
Breakdown from consolidation
680
False Hope
New low
New lowNew low
Yes Bank
J 18 A 16 31 S 28 O 30 N 27 D 26 J18 23 F 22 M 23 A 24 M 23 J 20 J 18 A 16 31 S O 17 N 16 D 17 J19 15 29 F 26 M 28 A 30 M 29 J
450
440
430
420
410
400
390
380
370
360
350
340
330
320
310
300
290
280
270
260
250
240
230
220
210
200
190
180
170
160
150
140
130
120
110
100
90
80
70
60
25 C
20 C
15 C
10 C
5 C
109.60
285.05
382.97
1-YES BANK LIMITED - 21/06/19 F7
Daily
QtyLine, Avg(QtyLine:S:10), DelQtyLine
383
Gap down open at 285
Consolidation 285
Breakout
Again reversal from breakdown level
Breakout failure and Gap down opening at 343
COLD
FEVERICU
Gap down open at 213
Unsung Heroes
Less Pattern Great Return
103
Pfizer – Strong Parentage/Trusted Brand
104
D J01 F02 S A03 N J04 J05 A M06 O M07 D J08 F09 S A10 N J11 J12 A M13 O M14 D J15 F16 S A17 N J18 J19
4 T
3900
3800
3700
3600
3500
3400
3300
3200
3100
3 T
2900
2800
2700
2600
2500
2400
2300
2200
2100
2 T
1900
1800
1700
1600
1500
1400
1300
1200
1100
1 T
900
800
700
600
500
400
300
200
3264.55
2-Pfizer Ltd. - 21/06/19 F7Net
Monthly
Higher Tops and Higher Bottoms
Honeywell Automation - Strong Parentage/Trusted Brand
105
S F08 J D M09 O M10 A J11 J N A12 S F13 J D M14 O M15 A J16 J N A17 S F18 J D M19
29 T
28 T
27 T
26 T
25 T
24 T
23 T
22 T
21 T
20 T
19 T
18 T
17 T
16 T
15 T
14 T
13 T
12 T
11 T
10 T
9 T
8 T
7 T
6 T
5 T
4 T
3 T
2 T
1 T
24658.60
2-Honeywell Auto India Ltd. - 21/06/19 F7Net
Monthly
Higher Tops and Higher Bottoms
Gillette India – Strong Parentage/Trusted Brand
106
J J05 J J06 J J07 J J08 J J09 J J10 J J11 J J12 J J13 J J14 J J15 J J16 J J17 J J18 J J19
8200
8 T
7800
7600
7400
7200
7 T
6800
6600
6400
6200
6 T
5800
5600
5400
5200
5 T
4800
4600
4400
4200
4 T
3800
3600
3400
3200
3 T
2800
2600
2400
2200
2 T
1800
1600
1400
1200
1 T
800
600
400
200
7450.65
2-Gillette India Ltd. - 21/06/19 F7Net
Monthly
Higher Tops and Higher Bottoms
HDFC Bank
107
F05 A F06 A F07 A F08 A F09 A F10 A F11 A F12 A F13 A F14 A F15 A F16 A F17 A F18 A F19
2500
2400
2300
2200
2100
2 T
1900
1800
1700
1600
1500
1400
1300
1200
1100
1 T
900
800
700
600
500
400
300
200
100
2414.20
2-HDFC Bank Ltd. - 21/06/19 F7Net
Monthly
Higher Tops and Higher Bottoms
10 Years: 19.74% 10 Years: 25.12% 10 Years: 18.08%
5 Years: 19.20% 5 Years: 19.98% 5 Years: 17.72%
3 Years: 18.01% 3 Years: 19.68% 3 Years: 17.32%
TTM: 23.34% TTM: 20.54% Last Year: 16.50%
Compounded Revenue Growth Compounded Profit Growth Return on Equity
Bajaj Finance
108
J08 J N A09 S F10 J D M11 O M12 A J13 J N A14 S F15 J D M16 O M17 A J18 J N A19
3700
3600
3500
3400
3300
3200
3100
3 T
2900
2800
2700
2600
2500
2400
2300
2200
2100
2 T
1900
1800
1700
1600
1500
1400
1300
1200
1100
1 T
900
800
700
600
500
400
300
200
100
-100
3565.85
2-BAJAJ FINANCE LIMITED - 21/06/19 F7Net
Monthly
Higher Tops and Higher Bottoms
10 Years: 39.22% 10 Years: 62.54% 10 Years: 20.12%
5 Years: 33.86% 5 Years: 34.95% 5 Years: 20.70%
3 Years: 35.08% 3 Years: 43.38% 3 Years: 20.89%
TTM: 37.56% TTM: 56.58% Last Year: 20.27%
Compounded Revenue Growth Compounded Profit Growth Return on Equity
Lower Price + Higher Attraction orHigher Price + Lower Attraction
109
RCOM, JP Associates, Suzlon, South Indian BankOrAarti Industries, 3M India, Godrej Properties
110
Past Heroes, not necessarily current heroes….
Reliance Infra
A01 N J02 J03 A M04 O M05 D J06 F07 S A08 N J09 J10 A M11 O M12 D J13 F14 S A15 N J16 J17 A M18 O M19
2700
2600
2500
2400
2300
2200
2100
2 T
1900
1800
1700
1600
1500
1400
1300
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1100
1 T
900
800
700
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500
400
300
200
100
60 C
50 C
40 C
30 C
20 C
10 C
57.50
2-Reliance Infrastructu Ltd - 21/06/19 F7Net
Monthly
QtyLine
High 2641Jan, 2008
4x from low
Double from low
Unitech
J O F04 J O F05 J O F06 J O F07 J O F08 J O F09 J O F10 J O F11 J O F12 J
560
540
520
500
480
460
440
420
400
380
360
340
320
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140
120
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40
20
-20
180 C
160 C
140 C
120 C
100 C
80 C
60 C
40 C
20 C
1.00
2-UNITECH LTD - 21/06/19 F7Net
Monthly
QtyLine
Cmp 1
High 547Jan, 2008
5x from low
Lupin
J07 J N A08 S F09 J D M10 O M11 A J12 J N A13 S F14 J D M15 O M16 A J17 J N A18 S F19
2200
2100
2 T
1900
1800
1700
1600
1500
1400
1300
1200
1100
1 T
900
800
700
600
500
400
300
200
100
8 C
7 C
6 C
5 C
4 C
3 C
2 C
1 C
712.80
2130.00
2-Lupin Limited - 21/06/19 F7Net
Monthly
QtyLine
October 2015
Sun Pharma
F11 J O F12 J O F13 J O F14 J O F15 J O F16 J O F17 J O F18 J O F19 J
1250
1200
1150
1100
1050
1 T
950
900
850
800
750
700
650
600
550
500
450
400
350
300
250
200
150
40 C
35 C
30 C
25 C
20 C
15 C
10 C
5 C
382.80
2-Sun Pharma Ltd - 21/06/19 F7Net
Monthly
QtyLine
High 1200April 2015
Dr Reddy
M S J10 M S J11 M S J12 M S J13 M S J14 M S J15 M S J16 M S J17 M S J18 M S J19 M
4400
4200
4 T
3800
3600
3400
3200
3 T
2800
2600
2400
2200
2 T
1800
1600
1400
1200
1 T
800
600
400
200
3 C
250 L
2 C
150 L
1 C
50 L
2551.55
2-Dr. Reddys Lab Ltd - 21/06/19 F7Net
Monthly
QtyLine
High 4386October 2015
Dating vs Marriage
• HEG
• Escorts.. Testing
118
Let’s Date…
• HEG
• Escorts.. Testing
119
800%
HEG 2013 2014 2015 2016 2017
Sales 1,623 1,467 1,233 870 860
Operating Profit (Rs. Crore) 238 221 182 136 81
ROE % 12.3 9.4 4.1 -1.6 -5.7
PBDIT Margin % 18.9% 18.3% 16.7% 15.5% 10.2%
• HEG
• Escorts.. Testing
120
Let’s Date…
More than 5 year consolidation
Breakout190
• HEG
• Escorts.. Testing
121
No more date… I’m serious!
315%
ESCORTS 2012 2014 2015 2016 2017
Sales 3,894 6,292 3,986 3,367 4,094
Operating Profit (Rs. Crore) 182 385 41 147 272
ROE % 4.4 13.6 4.2 4.9 8.1
PBDIT Margin % 5.9% 7.4% 5.6% 6.3% 9.0%
• Page Industries
• Britannia
• KEC
122
You are the best!!
17000Breakout
High volume
23.6%
38.2%
50%
61.8%
100%
Fibonacci Retracement & Extension
Fibonacci Retracement Levels
100%
138.2%
161.8%
261.8%
Fibonacci Extension Levels
J13 M A M J A O N D F14 M M J J S O N J15 F A M J A S O D J16 M A M J
23 T
22500
22 T
21500
21 T
20500
20 T
19500
19 T
18500
18 T
17500
17 T
16500
16 T
15500
15 T
14500
14 T
13500
13 T
12500
12 T
11500
11 T
10500
10 T
9500
9 T
8500
8 T
7500
7 T
6500
8349.68
17958.93 (23.60% )
16122.61 (38.20% )
14638.46 (50.00% )
13154.31 (61.80% )
8349.68 (100.00% )
20927.23
1-BANKNIFTY.Rolling - 09/10/19 F7
Weekly
Fibonacci Retracement
J15 30 F M A M J J A S O N D J16 29 F M A M J J A S O N D 30
9500
9450
9400
9350
9300
9250
9200
9150
9100
9050
9 T
8950
8900
8850
8800
8750
8700
8650
8600
8550
8500
8450
8400
8350
8300
8250
8200
8150
8100
80508 T
7950
7900
7850
7800
7750
7700
7650
7600
7550
7500
7450
7400
7350
7300
7250
7200
7150
7100
7050
7 T
6950
6900
6850
6800
6750
6700
6650
6600
6550
6500
7399.18 (23.60% )
7727.60 (38.20% )
7993.02 (50.00% )
8258.45 (61.80% )
9117.72 (100.00% )
6868.33
1-Nifty 50 - 09/10/19 F7
Weekly
Fibonacci Extension
J O J09 A J O J10 A J O J11 A J O J12 A J O J13 A J O J14 A J O J15 A
860
840
820
800
780
760
740
720
700
680
660
640
620
600
580
560
540
520
500
480
460
440
420
400
380
360
340
320
300
280
260
240
220
200
180
160
140
120
100
80
60
40
20
-20
-40
25 C
20 C
15 C
10 C
5 C
712.75
742.81
504.68
448.15
356.74
51.25
289.50
119.07
357.31 (100.00% )
448.32 (138.20% )
504.55 (161.80% )
742.79 (261.80% )
1-TECH MAHINDRA LIMITED - 09/10/19 F7
Monthly
QtyLine
VOLUMES
128
M 30 J J A S O N D J15 F M A 30 M J J A S O N D J16 F M A 29 M J J A S O N D J17 F M 31 A M J J A S O
640
620
600
580
560
540
520
500
480
460
440
420
400
380
360
340
320
300
280
260
240
220
200
180
160
140
120
100
80
60
40
20
140 L
120 L
1 C
80 L
60 L
40 L
20 L
286.45
1-SHAKTI PUMPS (INDIA) LIMI - 31/07/19 F7
Weekly
QtyLine
Breakout
Breakout Volume
280
95
Height =280-95=185
Target = 280 + 195 = 475
Comparative Strength vs Peers vs Sectors vs Benchmark
129
Good Business Good Cycle – Buy on dips, Buy on Rallieseg HDFC Bank, Nestle India, Infosys, Asian Paints, Bajaj Finance
Good Business Bad Cycle – Be Opportunisticeg Tata Steel, L&T
Bad Business Good Cycle – Buy on every breakout, Sell on first significant reversaleg HEG, Rain Industries,
Bad Business Bad Cycle– Don’t toucheg JP Associates, RCOM, HCC,etc
130
Define your company
Reliance Industries
131S J08 M S J09 M S J10 M S J11 M S J12 M S J13 M S J14 M S J15 M S J16 M S J17
920
900
880
860
840
820
800
780
760
740
720
700
680
660
640
620
600
580
560
540
520
500
480
460
440
420
400
380
360
340
320
300
280
260
240
220
200
180
160
50 C
40 C
30 C
20 C
10 C
1-Reliance Industries Ltd - 12/12/19 F7
Monthly
QtyLine
Multi year consolidation8 years
Symmetrical Triangle Pattern
600
Higher volumes on up move
Reliance Industries
J D M08 O M09 A J10 J N A11 S F12 J D M13 O M14 A J15 J N A16 S F17 J D M18 O M19 A
1850
1800
1750
1700
1650
1600
1550
1500
1450
1400
1350
1300
1250
1200
1150
1100
1050
1 T
950
900
850
800
750
700
650
600
550
500
450
400
350
300
250
200
150
100
50
50 C
40 C
30 C
20 C
10 C
1568.20
1-Reliance Industries Ltd - 12/12/19 F7
Monthly
QtyLine
1600
1614
600
194% in 33 months
Mutual Fund Industry
➢ Indian MF AUM as a share of GDP (11%) remains significantly lower than the world average of 62%
➢ Indian Mutual Fund has grown at CAGR of 17.4% over last 10 years, which is only second to China and twice ofGlobal AUM. India is 7th largest economy in the world, yet ranks 17th in terms of Mutual Fund AUM.
➢ Indian household savings as a percentage of GDP have declined over the recent past, RBI data indicate thathouseholds are moving higher shares of their savings to financial assets
➢ Within financial assets, the share of non-bank deposit instruments like mutual funds and insurance are on therise. Traditional physical savings avenues real estate and Gold have given stagnating or falling returns asopposed to higher returns in equity and debt.
➢ Fixed income returns trended down since FY12, hence from Retirement planning perspective MF imperative.
➢ Top 10 funds contributed ~82% to Industry AUM in FY19, showing that scale is crucial for thriving in theindustry. While the industry has seen an increase in the number of mutual fund players, it has also undergoneconsolidation, especially the mid-sized and smaller AMCs.
Mutual Fund Industry
MF industry has witnessed healthy growth with AUM of ~Rs. 25.6 trillion as of end-September 2019; implying~17% CAGR for nearly two decades. From a more recent starting point (FY11) also, overall MF AUM growth hasshown a strong performance with through-the-cycle overall MF AUM CAGR (FY11 - FY19) of 19%.
Mutual Fund Industry AUM GrowthMF AUM to total deposits of Scheduled Commercial Banks
Mutual Fund Industry
➢ MF Industry has 44 players with 5 largest AMCs commanding a market share of 58%.
➢ BIG are getting BIGGER – HDFC, ICICI and SBI market share of 38.7% in Mar’19 vs 25.2% in Apr’06.
➢ Bank/Financial conglomerate promoted AMCs enjoy distribution and brand advantage.
➢ Significant recent regulatory changes such as revised expense ratios will lower costs for mutual fundinvestors and should aid in greater retail participation
➢ Systematic Investment Plan (SIP) flows have seen high growth over the last five years and should be astrong driver for MF AUM growth. They have been persistent despite market volatility.
➢ Unique mutual fund investor count in the industry is still only ~20mn. This low penetration providesscope for strong future growth
➢ Equity-oriented schemes share increased from 33% in Mar’10 to 37% in Mar’19.
HDFC AMC
➢ Operates as an investment management firm. Offers portfolio management and advisory services to individuals,institutions, trusts, private funds, charitable organizations, and investment companies. HDFC Asset Managementserves customers in India.
➢ HDFC AMC is largest AMC with market share of 14% and AUM of Rs 3.43 lakh cr. Formidable size achieved due tobenefits Parentage/Trusted brand name, strong pan-India distribution network, operational efficiency, focus on thehigher-yield equity segment, and consistent fund performance over the past, led to healthy AUM growth at highlyprofitable levels.
➢ India’s under penetration of mutual funds relative to the world vs. competing areas of bank deposits/insuranceadditionally lends credence to longer-cycle growth from the “financialization” of savings. Company’s business modelchecks most of the investment criteria of a growing and high-ROE business, positive free cash flow and high dividendpayouts.
➢ HDFCAMC’s business is well positioned longer term, benefiting from its leadership position in the industry (andespecially equity) and its status as the most profitable AMC in the industry since 2011.
➢ The superior product mix helps company generate higher yield on AUM. The equity mix of AUM, at 47.7%, continuesto be higher than industry levels of 43.3%
➢ The AMC has been a net beneficiary of a ban on upfront commissions that has resulted in margins movingstructurally up. Further, it has been able to largely pass on all total expense ratio reductions to its distributors
HDFC AMC
as of Sep 2019
Shareholding Income Statement Key Ratios
HDFC AMC
28 S 14 25 O 12 23 31 N 19 28 D 14 24 J19 10 18 28 F 13 21 M 12 20 29 A 16 26 M 16 24
2080
2060
2040
2020
2 T
1980
1960
1940
1920
1900
1880
1860
1840
1820
1800
1780
1760
1740
1720
1700
1680
1660
1640
1620
1600
1580
1560
1540
1520
1500
1480
1460
1440
1420
1400
1380
1360
1340
1320
1300
1280
1260
1240
1220
1200
1180
1160
50 L
40 L
30 L
20 L
10 L
1-HDFC ASSET MANAGEMENT COM - 13/12/19 F7
Daily
QtyLine
1600 Double bottom breakout
1st Bottom
2nd Bottom
Moved 28%from lows
1760
Rs. Crores Mar-18 Mar-19 %
Sales 469 486 4%
Operating Profit 248 357 44%
Other Income 31 61 97%
Deprication 2 3 50%
PBT 277 415 50%
Net Profit 172 276 60%
Quarterly Result
HDFC AMC
21 S 21 O 23 N 21 D 20 J19 18 F 15 M 18 A 16 M 20 J 18 J 16 30 A 29 S 30 O 31 N 29
4200
4100
4 T
3900
3800
3700
3600
3500
3400
3300
3200
3100
3 T
2900
2800
2700
2600
2500
2400
2300
2200
2100
2 T
1900
1800
1700
1600
1500
1400
1300
1200
1100
1 T
900
150 L
1 C
50 L
2890.10
D
D
1-HDFC ASSET MANAGEMENT COM - 10/12/19 F7
Daily
QtyLine
1600
3844
1760
118% in 6 months
General Insurance
Significantly underpenetrated Non-Life Insurance Density/(Premium per capita)
ICICI Lombard
➢ The company commenced operations in FY02 and has built a large franchise by delivering a diverse set ofproducts in the corporate and retail segments. The company’s market share on GDPI basis stood at 8.2%among all non-life insurance insurers and 16.8% among private sector non-life insurers. It became the firstprivate sector non-life insurer in India to reach Rs100bn in GDPI in Fiscal 2017.
➢ Private insurers are gaining market share with ICICI Lombard as the leader among the private firms
➢ Improving profitability in motor segment due to change in regulations – a series of steps taken by the regulatorto drive penetration and bring rationality to competition could lead to acceleration in premium growth. MotorTP insurance stands mandatorily be sold for a period of 3 years and 5 years for 4 wheelers and 2 wheelersrespectively, starting 1st September 2018
➢ Conservative approach towards high growing crop insurance segment.
➢ Lower intensity from PSU players as they focus on profitability.
➢ The company’s better underwriting performance was also supported by its flexibility to enter/exit businesslines based on risk factors. Because of which share of losses incurred from each catastrophic event since FY13has been in the range of 1.5%-6.2%, while I-Lom’s overall market share, by GDPI, has been higher than 7%during the same time period
ICICI Lombard
D 18 29 J18 22 F 15 27 M 22 A 17 27 M 22 J 13 25 J 17 27 A 21 S 14 27 O 23 N 15 28
980
970
960
950
940
930
920
910
900
890
880
870
860
850
840
830
820
810
800
790
780
770
760
750
740
730
720
710
700
690
680
670
660
650
640
630
620
610
600
30 L
25 L
20 L
15 L
10 L
5 L
D
D
1-ICICI LOMBARD GENERAL INS - 10/12/19 F7
Daily
QtyLine
Base Formation
900
ICICI Lombard
D J18 F M A M J J A 31 S O N D J19 F M A M J J A 30 S O N
1520
1500
1480
1460
1440
1420
1400
1380
1360
1340
1320
1300
1280
1260
1240
1220
1200
1180
1160
1140
1120
1100
1080
1060
1040
1020
1 T
980
960
940
920
900
880
860
840
820
800
780
760
740
720
700
680
660
640
620
600
580
560
540
3 C
250 L
2 C
150 L
1 C
50 L
1349.50
D
D
D
D
1-ICICI LOMBARD GENERAL INS - 10/12/19 F7
Weekly
QtyLine
1400
900
55% in 12 months
Life Insurance
➢ Underpenetrated insurance market; India’s position in global insurance sector is a distant 11th position
➢ Economic growth prospects and rising income levels are long term positives for life insurance sector
➢ Life insurance dominate the insurance market in India although non-life recording faster growth
➢ LIC dominates the Life insurance sector of India; Private players making steady inroads
➢ High commissions charged by LIC agents; room for private sector to compete
➢ Capital requirements for life insurers; private players well placed on solvency front
➢ Private insurance players outpacing LIC on AuM growth
➢ Unit linked policies dominate product mix for ICICI Pru; SBI Life & HDFC Life more balanced
➢ Long gestation period to break-even averaging 8+ years hence unviable for foreign insurers which have noother foothold in India and life insurance sector expected shielded and favorable for the local players.
Life Insurance
Life Insurance penetration rate in India (%) Life Insurance premium per capita in India (US$)
HDFC Life Insurance
Quarterly Result
26 M 21 31 J 22 J 16 26 A 20 31 S 26 O 22 N 14 27 D 19 J19 11 23 F 14 26 M 22 A 15 30 M 23
580
570
560
550
540
530
520
510
500
490
480
470
460
450
440
430
420
410
400
390
380
370
360
350
340
330
320
2 C
150 L
1 C
50 L
572.50
D
1-HDFC LIFE INSURANCE COMPA - 11/12/19 F7
Daily
QtyLine, Avg(QtyLine:S:10)
Rectangle ConsolidationBase Formation
410
HDFC Life Insurance
350
Correction
Accumulationat lower levels
M 21 J 22 J 26 A 31 S O 26 N D 19 J19 23 F 26 M A 23 M 29 J J 19 A 26 S O 22 N 26
690
680
670
660
650
640
630
620
610
600
590
580
570
560
550
540
530
520
510
500
490
480
470
460
450
440
430
420
410
400
390
380
370
360
350
340
330
320
310
300
8 C
6 C
4 C
2 C
572.50
D
1-HDFC LIFE INSURANCE COMPA - 11/12/19 F7
Daily
QtyLine, Avg(QtyLine:S:10)
646
410
58% in 5 months
HDFC Life Insurance
ICICI Prudential Life Insurance
Quarterly Result
23 J A 30 S O N 24 D J18 30 F M A 30 M J J 24 A S O 24 N D 31 J19 F M 27 A M
540
530
520
510
500
490
480
470
460
450
440
430
420
410
400
390
380
370
360
350
340
330
320
310
300
290
280
270
260
250
2 C
150 L
1 C
50 L
490.10
D
DD
D
1-ICICI PRUDENTIAL LIFE INS - 11/12/19 F7
Daily
QtyLine, Avg(QtyLine:S:10)
Bullish InvertedHead & Shoulders
410
380
Correction
Accumulationat lower levels
ICICI Prudential Life Insurance
17 31 N 28 D 24 J19 18 31 F 26 M 26 A 23 M 21 J 17 28 J 24 A 21 S 18 O 16 30 N 26 D
580
570
560
550
540
530
520
510
500
490
480
470
460
450
440
430
420
410
400
390
380
370
360
350
340
330
320
310
300
290
280
270
260
250
240
350 L
3 C
250 L
2 C
150 L
1 C
50 L
490.10
D
D
D
1-ICICI PRUDENTIAL LIFE INS - 11/12/19 F7
Daily
QtyLine, Avg(QtyLine:S:10)
537
380
41% in 5 months
ICICI Prudential Life Insurance
Thank You
152
Symmetrical Triangle
153
D M08 O M09 A J10 J N A11 S F12 J D M13 O M14 A J15 J N A16 S F17 J D M18 O M19
1600
1550
1500
1450
1400
1350
1300
1250
1200
1150
1100
1050
1 T
950
900
850
800
750
700
650
600
550
500
450
400
350
300
250
200
150
100
50 C
40 C
30 C
20 C
10 C
1183.75
1-Reliance Industries Ltd - 31/07/19 F7
Monthly
QtyLine
630
230
560 Strong Breakout
960
Height =400
Target = 560 + 400 =
Volumes on breakout
154
Does all time high scare you??
High Volumesindicating buying
130%
• Universal Cables – M – Line chart
• Vol – smart
• Avenue – Future Retail - Vmart
155
Quality of high matters a lot..
143%
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