Blog posts of '2024' 'July'

Stock name: Cholamandalam Financial Holdings Ltd.

Pattern: Flag and pole pattern

Time frame: Weekly

Observation:

Between March and September 2023, the stock experienced a rapid rise. Since September, it has consolidated, forming a flag and pole pattern on the weekly chart. In June 2024, the stock broke out of this pattern with above-average trading volume and a bullish MACD indicator. Following the breakout, the stock continued to move rapidly upwards. Technical indicators suggest that if the current momentum is sustained, the stock may climb even higher.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

Stock name: Kfin Technologies Ltd.

Pattern: Double bottom pattern and retest

Time frame: Daily

Observation:

Since May 2024, the stock has declined, forming a double bottom pattern on the daily chart. On July 2, 2024, it broke out of this pattern with above-average trading volume and a positive MACD breakout. After the breakout, the stock moved slightly upward but immediately faced a retest. Currently, the RSI is in a favourable zone. According to technical analysis, if the stock rebounds from the retest, it may continue to rise.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

News for the day:

• India is likely to amend its EV policy to benefit legacy car manufacturers that have already invested in the country, as Tesla has not committed to building a factory. The current policy supports only new investments for high-end EV manufacturing. The government may allow investments in plants producing both internal combustion and electric vehicles to qualify for incentives. Automakers have raised concerns that the policy should also consider existing investments. Consultations are ongoing to make the Scheme for Manufacturing of Electric Cars (SMEC) more attractive to traditional companies.
  
  
• Bajaj Auto is set to disrupt the market with its CNG-powered Freedom 125 motorcycle, priced between Rs 95,000 and Rs 110,000. It aims to challenge Hero Honda by reducing operating costs by up to 50% compared to petrol bikes. Rajiv Bajaj sees this as "returning the favour" to Hero Honda, which transformed the market 25 years ago. Targeting the entry-level segment, Bajaj plans to produce 10,000 units monthly, increasing to 40,000-50,000 by FY25, with initial focus on the domestic market.
  
  
• PC Jeweller Ltd announced that Punjab National Bank has approved a one-time settlement (OTS) for its outstanding dues. This approval was disclosed in a regulatory filing, noting that PNB, the third largest bank in the consortium, has agreed to the company's OTS proposal. The settlement includes cash and equity components, and details about the release of securities and properties. PC Jeweller, which operates 60 showrooms across 44 cities in India, is refocusing on brand presence and marketing. The company is also revamping business operations, including new jewellery collections and franchisee business optimization.

Stock name: E.I.D. Parry (India) Ltd.

Pattern: Cup and handle pattern and retest

Time frame: Weekly

Observation:

The stock has maintained an overall upward trend. From November 2022 to May 2024, it formed a cup and handle pattern on its weekly chart. A breakout occurred on May 27, 2024, supported by above-average trading volume and a bullish MACD indicator. The stock surged upwards post-breakout but is currently retesting due to a very high RSI. This retest is expected to cool down the RSI, and if the stock rebounds, then as per technical analysis it may continue to rise further.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

Stock name: Archean Chemical Industries Ltd.

Pattern: Cup and handle pattern

Time frame: Daily

Observation:

The stock experienced a significant decline in March 2024 but has since recovered, forming a cup and handle pattern on its daily chart. On July 2, 2024, it broke out from this pattern with substantial trading volume. Following the breakout, the stock is trending upwards with a high RSI. Technical analysis suggests that if the stock maintains its current momentum, it may continue to rise further.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

News for the day:

• HDFC Bank's Q1 Update: Advances surged 53% YoY to Rs 24.87 lakh crore, with deposits up 24% to Rs 23.79 lakh crore. Excluding the HDFC merger impact, advances grew 15%. Retail loans increased by Rs 18,600 crore, and commercial and rural banking loans rose by Rs 7,200 crore, while corporate loans fell by Rs 26,600 crore. CASA deposits reached Rs 8.63 lakh crore, a 6% increase. The liquidity coverage ratio was 123%. HDFC Bank shares closed 2.3% lower at Rs 1,728 on the NSE.
  
  
• Raymond's board has approved the demerger of its real estate arm, Raymond Realty, to unlock growth potential and attract new investors. The restructuring aims to maximize the unique strengths of each business division by allowing focused management. Shareholders will receive one Raymond Realty share for each Raymond share they hold. The demerger will enable the real estate and remaining businesses to grow independently and specialize in their respective areas. Post-demerger, Raymond Realty shares will be listed on the BSE and NSE. Raymond shares closed nearly 1% lower at Rs 2,933 on the NSE.
  
  
• The Steel Executives Federation of India (SEFI) has proposed merging state-run Rashtriya Ispat Nigam Limited (RINL), Ferro Scrap Nigam Limited (FSNL), and Nagarnar steel plant with Steel Authority of India Limited (SAIL) to create a stronger public sector entity. SEFI believes this merger will help SAIL achieve its 35 million tonnes capacity expansion target by 2030 and address resource challenges faced by the individual firms. The merger aims to leverage the strengths of each firm to form a more efficient and financially viable entity.

Stock name: Nuvoco Vistas Corporation Ltd.

Pattern: Double bottom pattern and retest

Time frame: Daily

Observation:

The stock declined starting in December 2023. From February to June 2024, it stabilized and formed a double bottom pattern on its daily chart. On June 14, 2024, it broke out with massive trading volume but has since faced a retest rebound and is currently in a second retest. The RSI level remains favourable. According to technical analysis, if the stock rebounds with strong momentum, it may move further upwards.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

Stock name: MMTC Ltd.

Pattern: Cup and handle pattern

Time frame: Daily

Observation:

From February to July 2024, the stock formed a cup and handle pattern on its daily chart. On July 3, 2024, it broke out from this pattern. The breakout was supported by huge trading volume and a positive MACD indicator. The RSI level is also currently in the favourable zone. According to technical analysis, if the breakout momentum is sustained, the stock may continue to rise.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

News for the day:

• UPI payments will now be available in the UAE through a partnership between NPCI International and Network International, enhancing payment experiences for Indian travellers and NRIs. This initiative demonstrates the growing global acceptance of UPI, with seamless and secure transactions facilitated via QR code-based payments at Network’s POS terminals. The UAE expects 5.29 million Indian tourists in 2024, reflecting the increasing demand for convenient digital payment solutions. NPCI's efforts for global UPI acceptance have already extended to countries like Nepal, Sri Lanka, Mauritius, Singapore, France, and Bhutan.
  
  
• Kumar Mangalam Birla's UltraTech is in advanced talks to acquire Orient Cement from CK Birla, aiming to bolster its presence in southern and western India. This move comes after Adani Cement's negotiations with CK Birla stalled over valuation and mining clearances. Orient Cement's stock has surged 45% in the past month amid acquisition speculation. UltraTech's offer is between Rs 350-375 per share, reflecting an enterprise value of Rs 7,300-7,800 crore. The acquisition would support UltraTech’s goal to reach a 200 MTPA capacity by 2027. A formal announcement is expected around Orient Cement's earnings release on July 19.
  
  
• Banks are facing challenges with Trai's new regulation requiring digital consent for commercial communications and have sought government clarity on whether this includes sharing transaction details under RBI guidelines. This move aims to combat cyber fraud. Banks also request special prefixes for customer calls, following a finance ministry directive. Existing consents will be voided, and new digital consents must be obtained. The DoT has allocated a 10-digit numbering series to help identify service calls and reduce cybercrime.

Stock name: Bajaj Holdings & Investment Ltd.

Pattern: Double bottom pattern and retest

Time frame: Daily

Observation:

Since March 2024, the stock has been declining but later stabilized, forming a double bottom pattern on the daily chart. It broke out from this pattern on June 24, 2024, with substantial trading volume. After the breakout, the stock underwent some retesting but has since rebounded, now moving upward with a slightly elevated RSI. Technical analysis suggests that if the current momentum holds, the stock may continue to rise.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

Stock name: LIC Housing Finance Ltd.

Pattern: Rounding bottom pattern

Time frame: Monthly

Observation:

From July 2017 to June 2024, the stock formed a rounding bottom pattern on its monthly chart. It broke out from this pattern in June 2024, with above-average trading volume. Currently, the stock's RSI is in the overbought zone, suggesting a potential retest of the breakout level. According to technical analysis, if the stock maintains its current momentum, it may continue to rise.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

News for the day:

• VinFast, the EV arm of Vietnam's Vingroup, will launch its first locally assembled car in India during the 2025 festive season, priced at ₹25-30 lakh with a range of 300-500 kilometers. The new Tamil Nadu factory, opening by March 2025, will save on import duties, enabling competitive pricing. VinFast will invest over $500 million to build a 150,000-unit factory, employing 3,000-3,500 workers. They aim to reach 50,000 units in the first year, supporting India's expanding EV market.
  
  
• Paytm Payments Bank Ltd (PPBL) is in conflict with its auditor JC Bhalla & Co. over business viability concerns. The auditor plans to qualify the FY24 accounts, citing regulatory curbs and halted operations, questioning the company's status as a 'going concern.' PPBL seeks RBI intervention, arguing its brand strength and planned capital infusion will support revival. Regulatory issues, including KYC non-compliance, have halted income and eroded net worth. The RBI has not indicated it will allow PPBL to resume operations, directing instead to wind down and transfer businesses to One97 Communications.
  
  
• Britannia has appointed former Reserve Bank of India Governor Dr. Urjit Patel and Atul's MD Sunil Siddharth Lalbhai as Additional Non-Executive Independent Directors for a five-year term from July 2, 2024, to July 1, 2029. Dr. Patel, who served as the 24th RBI Governor and Deputy Governor, brings extensive experience from roles in monetary policy and international financial institutions. Lalbhai, with a long tenure as Chairman and MD of Atul Limited, has also contributed significantly to India's chemical industry planning.

Stock name: Gujarat Narmada Valley Fertilizers and Chemicals Ltd.

Pattern: Double bottom pattern and retest

Time frame: Daily

Observation:

The stock experienced a downward trend starting January 2024 but later stabilized, forming a double bottom pattern on its daily chart. On June 20, 2024, it broke out from this pattern with significant trading volume. However, following the breakout, the stock heavily retested the breakout level, even closing below it for a few sessions. Currently, the stock is again near the breakout level, with a positive MACD indicator and a favourable RSI. According to technical analysis, if the stock rebounds with strong momentum, it may continue to rise.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

Stock name: Granules India Ltd.

Pattern: Cup and handle pattern

Time frame: Monthly

Observation:

The stock has formed a cup and handle pattern on its monthly chart from December 2020 to June 2024. It experienced a breakout in June 2024, supported by above-average trading volume. Since the breakout, the stock has been moving upward with a high RSI level. According to technical analysis, if the stock maintains its current momentum, it may continue to rise.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

News for the day:

• Patanjali Foods is set to acquire Patanjali Ayurved's home and personal care business for Rs 1,100 crore. This acquisition, which includes a licensing agreement for trademarks and intellectual property rights, will help Patanjali Foods transition into a full-fledged FMCG company. The acquisition will consolidate the Patanjali brand under Patanjali Foods' FMCG portfolio, enhancing brand equity, product innovation, cost optimization, and market share. Patanjali Ayurved currently owns a 32.4% stake in Patanjali Foods.
  
  
• The Indian government has increased the windfall tax on petroleum crude from Rs 3,250 to Rs 6,000 per metric ton, effective July 2. This tax, reviewed bi-weekly and introduced in July 2022, aims to curb exports by private refiners. The hike follows a recent reduction in the tax on June 15. India, the third-largest oil consumer, relies on imports for over 85% of its crude oil. Oil prices rose by about 2% on Monday due to expected higher summer demand and OPEC+ production cuts, with Brent futures for September delivery reaching $86.25 per barrel.
  
  
• UK's Vodafone Group Plc may inject ₹2,000 crore equity into Vodafone Idea (Vi) from the sale of its remaining 3.1% stake in Indus Towers, analysts say. This equity infusion could help Vi reduce its dues to Indus. Vi plans to raise ₹23,000-25,000 crore through term loans, enabling it to make more substantial payments towards its debt. Vodafone is in talks with Bharti Airtel to sell its remaining Indus stake. Indus shares rose 3.9% on Monday, valuing Vodafone's stake at ₹3,256 crore. Airtel recently increased its stake in Indus to 48.95%.

Stock name: Aether Industries Ltd.

Pattern: Cup and handle pattern

Time frame: Daily

Observation:

The stock has been in a downward trend since June 2023. From March to June 2024, it stabilized and formed a cup and handle pattern on its daily chart. The stock has registered a breakout from the pattern on June 26 2024. The breakout from this pattern was supported by substantial trading volume. Following the breakout, the stock has been moving upward with a high RSI. According to technical analysis, if the stock maintains its current momentum, it may continue to rise.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

Stock name: Syrma SGS Technology Ltd.

Pattern: Inverse head and shoulders pattern and retest

Time frame: Daily

Observation:

Since December 2023, the stock has trended downward. Between April and June 2024, it formed an inverse head and shoulders pattern on its daily chart. A breakout from this pattern occurred on June 21, 2024, with significant trading volume. However, the stock is currently retesting the breakout line. Despite this, the RSI remains favourable, and if the stock rebounds from the retest, it may move further upward according to technical analysis.

You may add this to your watch list to understand further price action.

Disclaimer: This analysis is purely for educational purpose and does not contain any recommendation. Please consult your financial advisor before taking any financial decision.

News for the day:

• India is rapidly closing the gap with China and Vietnam in mobile phone exports. In FY24, mobile phone exports from China and Vietnam declined by 2.78% and 17.6%, respectively, while Indian exports surged by 40.5%, according to officials citing global trade data. India has captured nearly 50% of the reduction in mobile phone exports from these two countries, aligning with its goal of absorbing a significant portion of the supply chain shift from China.
  
  
• Godrej Properties has acquired Transfer of Development Rights (TDR) certificates worth Rs 50 crore for its Sector 43 project in Gurgaon, a practice common in Mumbai but new to the NCR region. These certificates allow for an additional 300,000 sq ft of construction, potentially generating Rs 900 crore in revenue. The TDRs, obtained from the Haryana government for land acquisition, have a floor area ratio (FAR) of 2. This strategic move is expected to spur similar transactions in Gurgaon, following the company's significant sales growth in FY24 and upcoming projects in prime sectors.
  
  
• Banks have increasingly turned to debt markets due to tight liquidity, leading to a 60% rise in borrowings through money markets and bonds during April-June compared to the previous year. Soumyajit Niyogi, director at India Ratings & Research, attributed this partly to the HDFC-HDFC Bank merger and restricted government spending during May's Union election. The merger added borrowing-led liabilities from the former non-banking financial company to overall bank borrowing data, further contributing to the increase.