Weekly Picks 03 October 2023

1. Aditya Birla Capital Limited

Counter	ABCAPITAL LTP 179.95
Call	Buy on dip
Target 1	202
Target 2	218
Stop Loss	160
Time Horizon	3-4 weeks
Notes	Buy-on-dip towards 174 & 167

Aditya Birla Capital Limited (“ABCL”) is the holding company for the financial services businesses of the Aditya Birla Group. With subsidiaries/JVs that have a strong presence across Protecting, Investing and Financing solutions, ABCL is a financial solutions group that caters to the diverse needs of its customers across their life cycle. Powered by more than 38,000 employees, the businesses of ABCL have a nationwide reach with over 1,331 branches, more than 2,00,000 agents / channel partners and several bank partners. As of June 30, 2023, Aditya Birla Capital Limited manages aggregate assets under management of about Rs. 3.9 lakh Crore with a consolidated lending book of over Rs. 1 lakh Crore through its subsidiaries and joint ventures.

Previous Close	175.9	TTM EPS	19.3
52 Week High	199.3	TTM PE	9.3
52 Week Low	106.7	P/B	2.9
Sector PE	28.7	Mkt Cap (Rs. Cr.)	46,765

(Source: Moneycontrol, BSE, Fisdom Research)

Technical Outlook

(Source: Fisdom Research)

ABcapital reached a low of 85 in June 2022 and then climbed to a multi-year high of 199.30 in July.
The counter after making fresh 6+ years highs entered into “Time & Price” consolidation. From the last three months it is trading within the range and made lows of 173.45 this month.
The overall trend is upward, but in the short to mid-term, it is in “Range to down”.
From a technical perspective, the counter will attract new buyers when its price falls to around 174 and 167. There’s significant support at these levels, and if it drops below that, there might be even lower levels of support.
Based on the current situation, consider buying the stock when it dips to these support levels. If it manages to stay above 202 for several weeks, it could be a good opportunity to buy more.

Open Interest Study

Expiry	CP	Strike	Open Interest
26-Oct-23	CE	190	453
26-Oct-23	CE	200	400
26-Oct-23	PE	175	376
26-Oct-23	PE	170	366
26-Oct-23	CE	180	347
26-Oct-23	CE	185	235
26-Oct-23	PE	180	208
26-Oct-23	CE	220	173
26-Oct-23	CE	175	139

In the October 2023 option chain, there is a noticeable buildup of call options at strike prices of 190 and 200.
Conversely, there’s a significant buildup of put options at strike prices of 175 and 170.

F&O Strategy

Scrip	ABCAPITAL LTP 179.95
Risk	Moderate
Ratio	1:1:1
Bias	Range to pullback
Max Reward Expected	₹83,000
Max Risk Expected	₹25,000

Action	Scrip	Quantity	IP	LTP
BUY	ABCAPITAL OCT FUT	5400	180.85	180.85
BUY	ABCAPITAL OCT 180 PE	5400	4.85	4.85
SELL	ABCAPITAL OCT 200 PE	5400	1.1	1.1

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2. Canara Bank Ltd

Counter	CANBK LTP 376.3
Call	Buy on dip
Target 1	400
Target 2	420
Stop Loss	325
Time Horizon	1-2 months
Notes	Buy-On-Dip towards 362 & 345

Widely known for customer centricity, Canara Bank was founded by Shri Ammembal Subba Rao Pai, a great visionary and philanthropist, in July 1906, at Mangalore, then a small port town in Karnataka. The Bank has gone through the various phases of its growth trajectory over hundred years of its existence. Growth of Canara Bank was phenomenal, especially after nationalization in the year 1969, attaining the status of a national level player in terms of geographical reach and clientele segments. Over the years, the Bank has been scaling up its market position to emerge as a major Financial Conglomerate with as many as thirteen subsidiaries/sponsored institutions in India and abroad. As at June 2023, Canara Bank services over 11.04 crore customers through a network of 9,653 branches and 12,114 ATMs/Recycler spread across all Indian states and Union Territories.

Previous Close	374.6	TTM EPS	70.6
52 Week High	386.0	TTM PE	5.3
52 Week Low	214.4	P/B	1.1
Sector PE	11.9	Mkt Cap (Rs. Cr.)	68,256

(Source: Moneycontrol, BSE, Fisdom Research)

Technical Outlook

(Source: Fisdom Research)

CANBK had its best monthly closing since November 2017 last month.
The overall trend and structure for CANBK with bullish buy-on-dips toeards certain support levels for delivery.
In the mid-term, as long as the stock stays above the 320-300 range, it’s expected to have a positive trend with targets set at 420, 440, and a major level at 460 in the coming months.
Technically looking at the short-term trend, consider buy-on-dips around 362 and 345. This might lead to higher prices, potentially reaching 400 or even 420 in the coming weeks.

Open Interest

Expiry	CP	Strike	Open Interest
26-Oct-23	CE	400	1135
26-Oct-23	CE	380	1100
26-Oct-23	PE	350	671
26-Oct-23	PE	360	594
26-Oct-23	CE	390	546
26-Oct-23	PE	370	538
26-Oct-23	PE	340	518
26-Oct-23	PE	380	461
26-Oct-23	CE	370	421

In the October 2023 there’s a notable buildup of call options at strike prices 400 and 380. Conversely, there’s a significant buildup of put options at strike prices 350 and 360.
If the stock price falls to around 360 or 350, it’s likely to attract buyers. However, for significant new buying and short-covering to occur, the price needs to stay above 400.

F&O Strategy

Scrip	CANBK LTP 376.3
Risk	Moderate
Ratio	1:1:1
Bias	Range to pullback
Max Reward Expected	₹36,000
Max Risk Expected	₹17,280

Action	Scrip	QTY	IP	LTP
BUY	CANBK OCT FUT	2700	378.75	378.75
BUY	CANBK OCT 380 PE	2700	13.65	13.65
SELL	CANBK OCT 400 PE	2700	6	6

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