Categories: Weekly Pick

Weekly Picks 22nd May 2023

1. Bharti Airtel Ltd.

CounterBHARTIARTL LTP 805.35
CallBuy on dip
Target 1855
Target 2900
Stop Loss770
Time Horizon2-3 weeks
NotesBuy-on-dip towards 800 & 780

Headquartered in India, Airtel is a global communications solutions provider with over 491 Mn customers in 17 countries across South Asia and Africa. The company ranks amongst the top three mobile operators globally and its networks cover over two billion people. Airtel is India’s largest integrated communications solutions provider and the second largest mobile operator in Africa. Airtel’s retail portfolio includes high speed 4G/4.5G mobile broadband, Airtel Xstream Fiber that promises speeds up to 1 Gbps with convergence across linear and on-demand entertainment, streaming services spanning music and video, digital payments and financial services.

Previous Close799.3TTM EPS14.7
52 Week High860.6TTM PE54.8
52 Week Low628.8P/B4.1
Sector PE23.9Mkt Cap (Rs. Cr.)457,186

(Source: Moneycontrol, BSE, Fisdom Research)

Technical Outlook

(Source: Fisdom research)

  • The stock is currently at a point where it may experience a significant increase in its value soon as it is on the verge of breaking out of ‘Consolidation’.
  • If the stock price drops, there is a strong support level at around 780, and another important support level at 755.
  • On the other hand, if the stock price goes up, it may reach levels of 855 and even higher at 975 in the coming months, as per “Harmonic Price Study”.

Open Interest Study

(Source: Fisdom research)

  • Open Interest data for the MAY Series suggests that there is a significant barrier for the stock price at around the 800 strike price.
  • At the lower end of the stock market, there is a significant accumulation of Put options (PE) contracts around the 780 levels . Compared to the Call options (CE), there are fewer contracts for the Put options at 780. it may be a good opportunity to buy the stock if its price decreases and reaches around the 780 level while maintaining strict stop loss.
  • Short covering can be expected once the counter sustains above 800 levels in the upcoming days.

F&O Strategy

ScripBHARTIARTL LTP 805.35
RiskModerate
Ratio1:1
BiasRange to pull back
Max Reward Expected₹29,023
Max Risk Expected₹Rs. 18,500
ActionScripQTYIPLTP
BUYBHARTIARTL 29-JUN 800 CE95025.825.8
SELLBHARTIARTL 29-JUN 850 CE9506.356.35
Invest Now

2. Hindustan Unilever Ltd

CounterHUL LTP 2641.40
CallBuy on dip
Target 12720
Target 22800
Stop Loss2520
Time Horizon2-3 weeks
NotesBuy-On-Dip towards 2600 & 2550

HUL is a subsidiary of Unilever, one of the world’s leading suppliers of Food, Home Care, Personal Care and Refreshment products with sales in over 190 countries. Forbes rated HUL as the most innovative company in India and #8 globally. With 90 years of heritage in India, Hindustan Unilever Limited (HUL) is India’s largest fast-moving consumer goods company. On any given day, nine out of ten Indian households use one or more of HUL brands, giving us a unique opportunity to build a brighter future.

Previous Close2627.6TTM EPS43.1
52 Week High2741.6TTM PE61.3
52 Week Low2100.0P/B12.6
Sector PE59.3Mkt Cap (Rs. Cr.)620,632

(Source: Moneycontrol, BSE, Fisdom Research)

Technical Outlook

(Source: Fisdom Research)

  • The stock has been trading in a phase of broad consolidation since August 2022.
  • Within this range the counter holds “Buy-On-Dip” outlook
  • If the stock price drops to around 2600 or 2550 levels, it may be a good time to buy for long-term.
  • It is important to set a stop-loss order below 2520. This means that if the stock price falls below this level on a weekly closing basis, it may be a signal to sell the stock to limit potential losses.

Open Interest

(Source: Fisdom Research)

  • HUL open interest indicates strong support at around 2500 levels followed by maximum CE open interest at 2600 levels indicating a “Tug-Of-War” action.
  • Buy on dips can be looked upon for fresh entry points for long term, while maintaining stop loss below 2500 levels as per open interest study.

F&O Strategy

ScripHUL LTP 2641.40
RiskModerate
Ratio1:1
BiasRange to pull back
Max Reward Expected₹17,100
Max Risk Expected₹12,900
ActionScripQTYIPLTP
BUYHINDUNILVR 29-JUN 2600 PE3007171
SELLHINDUNILVR 29-JUN 2600 PE3002828
Invest Now

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