Ask Profit | Budget 2024 In Focus | NDTV Profit
-Stocks to watch out for in trade on #Budget2024 day
-#Nifty, #Sensex recover in trade
Get all your stock-related queries answered by our technical and fundamental guests with Alex Mathew and Smriti Chaudhary on Ask Profit. #ndtvprofitlive
-#Nifty, #Sensex recover in trade
Get all your stock-related queries answered by our technical and fundamental guests with Alex Mathew and Smriti Chaudhary on Ask Profit. #ndtvprofitlive
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TVTranscript
00:30Hello and welcome. You're watching Ask Profit on NDTV Profit. I'm Smriti Chaudhary and with
00:58me is Alex Mathew. And this show is geared towards your stock related queries, be it
01:03a technical query or a fundamental one. Do write to us on the WhatsApp number that's
01:07flashing on your screen or on any of our social media channels and we'll get them answered
01:12by our guests. But before that, let's take a quick check of the markets. You have the
01:16Nifty 50 pretty much flat at this juncture, not doing too much trading with a negative
01:21bias at this point. If you look at the broader markets doing better than the benchmark, Nifty
01:27mid cap up about a percent in trade while Nifty small cap about 7.1% or 8.1% up in trade.
01:35Let's pull up the contributors of the Nifty 50. It's the heavyweights that are dragging
01:40the index like RIL that's down about 80 points. There is Kutak Mahindra Bank, Wipro, ITC that
01:46are all down in trade after not as great of results as they were expected. However, there
01:53is HDFC Bank, Infosys, Mahindra and Mahindra NTPC that are in the green and are contributing
02:00positively to the index. Let's also look at the sectors. You have the Nifty Realty that's
02:06a drag today, FMCG Oil and Gas, IT all in the red. On the other hand, you have Nifty
02:11Healthcare Index, Pharma, Auto in the green. Healthcare and Pharma are doing especially
02:15well up over a percent in trade. Most of the stocks today are moving on the back of the
02:21results. There is Oberoi Realty that's up 4.5%. There is PVRInox that's up 2% in trade
02:28both on the back of their results, the first quarter results. However, there is a pack
02:33which is the Chemical and Fertilizer pack that's doing much, much better today. You
02:37pull up something like an RCF that's up 11% in trade. There is Fertilizer and Chemical
02:43Travancore that's up 8% in trade. There is Chemplast up 7% in trade. GSFC also up about
02:535.5% in trade. There is another pack which is the Defense Pack, something like a Cochrane
02:58Shipyard that's also doing well in trade. Garden Reach also up, there is Cochrane Shipyard
03:04about 4.5% in trade. So, these are a couple of stocks that are doing well in trade today.
03:10Absolutely. And it's all about the budget, right? Of course, the heavyweights have reported
03:15their earnings and we were talking about it this morning, about a quarter of the Nifty
03:1950 in terms of weightage reporting numbers for the first quarter post market hours on
03:24Friday and that's all playing out as Smriti just pointed out in the equity markets today.
03:29Let's get our experts on board then. We've got Avinash Gorachekar, who is Director Research
03:34at ProfitMart Securities and Rajesh Palviya, who is Senior Vice President Technical and
03:38Derivatives Research at Axis Securities. Thank you so much to the both of you for
03:42joining us this morning. And like I said, it's all about the budget trade, right? So,
03:46I'm curious first and normally we go to our fundamental expert about a particular stock,
03:52but I want to go to you first, Rajesh, based on what you're seeing on the charts and I'm
03:57sure that a lot of our viewers are going to be curious about how to trade derivatives
04:02ahead of this big event. Would you say that caution is advocated? Would you say that you
04:08should wait till the dust settles? How would you position yourself and are there individual
04:12counters that you're looking at closely? Good afternoon, Alex. Good afternoon, everyone.
04:18So we have already witnessed some volatility ahead of the event. So most of the positions
04:23are aligning themselves ahead of this big event. We have seen most of the big cap stocks
04:30have witnessed profit booking in last week itself. And Nifty also corrected from its
04:36recent high and almost tested a level of 24,400. Looking at the derivative data, the major put
04:44base concentration for this Nifty is placed at around 24,400, 24,300. These two levels are very
04:52important and critical ahead of a budget event. If it breaks below 24,300 on budget day or prior
05:01to budget or post budget 10, possible follow up selling action we can witness and then Nifty can
05:07go down further to 24,000 level. Even below also there is a possibility we can slip to below 24,000
05:16level also. So 24,300 should be kept as a stop loss. Those who have already hold the position
05:23ahead of a budget. If we break those levels, then I think one should exit some of the trading
05:30position if it breaks below 24,300. Even for Bank Nifty, the major support area at this moment is
05:38placed at 51,800, 51,700. These two levels needs to watch closely ahead of budget. If it breaks
05:46those levels, then possible down move can extend to 51,200, even 51,000 for Bank Nifty also.
05:54On the higher side, the major supply zone is placed at 24,000, 650 and 700 zone for Nifty.
06:03If it cross 24,700, then really can extend to 25,000 also. So I think these levels needs to
06:09watch closely at this moment to play this budget move. I think shorts triangle would be the only
06:18strategy where one can focus deep out of the money call put, one can write. So 23,500 strike
06:25one can write and sell. And on the higher side, 25,000 strike one can sell. These could be the
06:32possible trade setup one can deploy ahead of this budget event. Fair point. All right. That's
06:40a derivative strategy that you should bear in mind. Avinash, a veteran of many, many budgets
06:46and of course, over the long term, it's not like this particular week is going to govern anything
06:51from the perspective of a long term portfolio building, right? But any opportunities that you
06:55see heading into the event, anything that you're buying today? Yeah, good afternoon, Alex. See,
07:02first of all, we are advising most of our clients to be on the fence. I think the budget is tomorrow,
07:08I think it's better that we take a constructive call once the budget is out, we understand all
07:13the elements of the budget. But I think one clear theme which is likely to be coming in this budget
07:19is the rural India theme. I think one could expect a lot of announcements for the rural sector,
07:25because this is one sector which has actually suffered a lot. So I think you could look at
07:30fast moving consumer goods, you could look at agrochemicals, fertilizers, anything to do with
07:35rural India. Companies which are largely supplying to the rural markets are obviously going to be
07:41key beneficiaries. And I think, you know, investors should also note that there has
07:45been a lot of hype and expectation for sectors like defense, railways, I think here possibly,
07:51one should not be surprised if some big announcements don't come out, because already a
07:56lot of announcements have already come in. So I think, you know, rural India related, you know,
08:01sectors and rural India related companies, Alex, could be better choices. And I think, definitely,
08:06you know, post the budget, as well as even if somebody wants to take a call today,
08:11one could definitely chip in. But I think one should take a longer term view, because budget
08:14is just one instrument. The longer term journey for the capital markets is not going to be governed
08:19by just one document. So I think tomorrow, let's wait and watch. But hopefully, it should be a mix
08:23of both growth and populist budget, which I think the market has already largely discounted.
08:28All right. Yes, we'll be looking out for that. And Avinash, let's start off with the queries.
08:33The first one is for you. This one's from Ramesh, who's writing in from Hyderabad. The counter
08:38they're talking about is Patel Engineering. The question is, should you buy at the current price?
08:42Now, we saw a little bit of weakness in the counter after the MD Rupen Patel passed away a
08:48couple of days ago. But from a fundamental standpoint, they're yet to come out with their
08:54first quarter numbers. But fourth quarter numbers seemed pretty good. There was a QIP, I remember,
08:59and they saw pretty good demand there as well. So from a fundamental standpoint, do you
09:04consider it a good buy at this point? Yeah, I think my guess is Patel Engineering is one of
09:11the market leaders in hydropower projects. And I think it already has an order book of close to
09:17about 19,000 to 20,000 crores. And the management has already given a commentary that in FY25,
09:23they're targeting for orders of 25,000 crores. Now, clearly, the payment cycle is long in this
09:28business. But typically, there are very few companies which operate here. And the government
09:32is obviously going to promote hydropower as another element of power, source of power.
09:38So I think clearly, visibility is very strong. Plus, the management is very well rooted. They
09:43know exactly the business very well. And despite the fact that the managing director unfortunately
09:48passed away, it has got a very well laid down management team in place, which I think is
09:54confident enough of carrying on the projects in future also. So I think if somebody were to buy
09:59now, one could look at a price target of roughly about 65-70 within a time frame of at least 8-12
10:05months. I think this sector is definitely going to see a lot of action. And Patel Engineering is
10:09one of the primary players. So I think from a longer term perspective, one can comfortably
10:13accumulate, but not with a short term view. Fair point. I'm coming back to you on another
10:18hydroelectric play. And we're talking about SJVN. We've got Johnny Martin from Dhanbad,
10:23who's bought 300 shares at levels of 128. And I'm just trying to pull up the chart and see
10:29where it's currently trading. 143 or thereabouts is where it is at. So he's in the green right now,
10:34but he's looking at a long term perspective. Avinash, would you hold on to this?
10:39Yeah, I think if the investor has a two-year view, Alex, I think hydropower in India is
10:44still a very small component. And these companies are extremely profitable.
10:49SJVN also made an offering, OFS, to large institutional investors. And now the stock
10:55is held by a lot of institutional, as well as PMS and HNI kind of investors. So I think you
11:01have to give some time for this stock, because now the stock has multiplied significantly from
11:05double digit levels. And I think now the journey will be purely based on the earnings and the
11:10order book kind of accretion. So prospects continue to be good. So I think if you have
11:14a two-year view, I think you can continue to hold on. Prospects look pretty promising.
11:18The next counter is GMR Infra. The question is from Dr. Sanjeev Dixit. They've been holding
11:25the counter from a price point of Rs. 35, Rajesh, a considerable profit there. And we've seen the
11:31price doubling in the last one year. Do you see this trajectory to continue? And if you can give
11:37us a target on this counter as well? So Smriti, GMR Infra is now trading
11:43near to its 50-day moving average. Looking at the short-to-medium-term structure, our stock is
11:50in a bullish trajectory only. Though some consolidation is happening in the stock since
11:56last couple of weeks. But still, looking at the short-to-medium-term setup, we still hold our
12:02bullish view as the stock is holding above the breakout level of 88. So till the stock is holding
12:08above 88 level, there is a possibility that again, we may see a good up move in the stock in
12:15short-term perspective. Once the stock crosses above 100 level, then there is a possibility of
12:21moving further higher to 115 to 120 also. So I think he may hold the position as the stock is
12:29in process to form a rounding bottom formation on a monthly chart, which is a long-term chart.
12:34So I think if he can hold for further more couple of months, I think there is a potential of
12:40120 to 125 level also. Understood. Reliance Industries losing quite a bit of ground,
12:47Smriti pointed this out at the start. It's down about 3% and proving to be a bit of a
12:52weight on the benchmark right now. The question is coming from Vishakha and she is wondering
12:56whether to buy it at the current market price, just about Rs. 3000 or thereabouts. Avinash,
13:02we're off the high point of the year. But if I look at the one-year performance,
13:07it is still trading, if I'm not mistaken, about Rs. 800 higher than it was at the low point.
13:14There we go. So it was trading at close to Rs. 2200 or thereabouts at the low point over the
13:19last 12 months or so. Is this a good opportunity to buy in your opinion? Because a lot of people
13:24have pointed out the possibility of value unlocking when we're talking about the listing
13:29of the retail business as well as the Jio business. But the O2C business has been a
13:33bit of a disappointment. Yeah, I think Alex, if you take a slightly medium term view over the
13:39next say 12 to 15 months, I think Reliance has definitely come to an attractive level. In fact,
13:44the first quarter numbers for Reliance have also been quite good. My sense is that the Jio business
13:50is getting scaled up quite strongly. The oil and gas business has also settled down very well and
13:55the retail business continues to do well. So I think now in the very near term, there could be no
14:01near term triggers. But one thing is very clear that the management is hopeful that by December,
14:06possibly there could be a value unlocking for the Jio business. The retail business is again
14:10lined up. So I think clearly Reliance should do well over the next couple of years. But I think
14:15if one were to do an SIP even at the current odd level, one could definitely expect a decent upside
14:21from these levels. I think you need to have a little patience because Reliance is one stock
14:25where it moves pretty slowly and you need to have a lot of conviction and patience to make money in
14:31this counter. So I would say that you have a long term view of at least 12 to 18 months,
14:35I think you can definitely start a company. Avinash, coming back to you, the next counter
14:39is Raymond. The question is from Naman who's writing in from Delhi. They want to buy Raymond
14:45at the current levels from a point of view of about 7 to 10 years. So a longer term perspective
14:51on this one and now it's trading exits lifestyle business. Do you think this is a good entry point
14:58into Raymond? Yeah, I think Raymond has moved up significantly. And I think if one were to
15:04make a call on Raymond, I would suggest that it's better to do a small SIP here,
15:08because you could get the benefit of averaging. Finally, the lifestyle business is hyped up,
15:13but the real estate business and the core business continues to do very well. In fact,
15:17I believe the next two years are going to be extremely strong for the real estate business
15:21and we are yet to see that get reflected into financial numbers. So I think despite the fact
15:25the stock having gone up, now the market is discounting what kind of revenue and profit
15:30the real estate business will throw. Of course, the core business continues to do well. So I think
15:33somebody who has got a two year kind of time frame can definitely start accumulating on a SIP
15:39kind of route, which can definitely give good returns. But please remember, this is a volatile
15:43stock. So you need to give in a time frame of at least 18 to 24 months. All right, it's time for a
15:48quick break, but I just do want to point out the markets. At this point, you have the benchmark
15:53that is more or less flat. It continues to be the case, but the small cap index is seeing quite a
15:57bit of action. It's up as much as a percent or thereabouts and that has showcased itself in the
16:02advance decline ratio and the market breadth has tilted in favour of the advances, very comfortably
16:07so. And that is a shift from what you saw at the start of the session. So let's see whether the
16:12market is getting some inkling of what could be announced in the budget tomorrow. We have to step
16:17into a very quick break. We've got more on the other side, so stay tuned.
19:47Hi, welcome back. You're watching Ask Profit and we're in the midst of the query segment,
20:03or rather we're in the midst of taking all of your questions. By the way, if you've got questions for
20:06us, just a quick reminder, send it to us on the WhatsApp number that will soon flash on the bottom
20:11of the screen. The next question is from Yash and he's writing in from Gurugram and he's asking about
20:16Lux Industries and we'll have to pull up the longer term charts because he bought quite a
20:20while back in 2021. His buy price is 3290 per share, which is elevated. The stock is still trading
20:28at around 1900 despite the kind of run that it's seen over the last one year or thereabouts. He's
20:34a long term investor and he says that time is not a constraint. What should he bear in mind? I know
20:40that he's looking at the long term view, but I'm still curious about what Rajesh has to say about
20:45the charts. Rajesh, recent move has been quite positive. It's looking strong. Is it looking good
20:50for the long term? So, stock has corrected significantly from its all time high trajectory.
20:58Almost stock was trading at around 4400 and all the way it has corrected to the level of 1000
21:04rupees and then some recovery has been taken place in last couple of months. Though the stock is
21:11still in a bearish trajectory on the long term chart. But yes, on the short term structure,
21:17there is a recovery that has taken place and the stock managed to break out of almost
21:2310 to 12 month consolidation range. So, looking at the short term structure, there is a possibility
21:30that we could see some more upside as the stock managed to break out above 1700 level. So, 1700
21:36is the important level at this juncture. If it continues to hold above 1700 level on a month on
21:43month basis, then there is a possibility that there could be really towards 2200 to 2400.
21:50That would be the next target where the stock can move further higher. So, lux industry, if you are
21:55still holding the position, your now stop loss should be at 1700. Possible near term,
22:02short term target would be around 2200 to 2400. All right. Radesh, the next counter is
22:09Jayprakash Ventures, Jayprakash Power Ventures. The question is from Ayush. They bought the
22:13counter at a price of 20 rupees. It's currently trading below that price from a longer term. And
22:20it has given about 200% returns in the last one year. So, it has grown very significantly in terms
22:27of price. What should somebody do who's still holding from such elevated levels?
22:35So, Smriti, stock has recovered and now it's consolidating since last couple of months in a
22:41range of 16 rupees to 20 rupees. That's the range which we are seeing in the consolidation.
22:48Though stock has already managed to break out of its short term consolidation range. So,
22:54we believe that till the stock is holding above 16 level, there is a possibility that
22:58stock may attempt to again break out above 20, 21 level. If that happens,
23:04then possible target we can see towards 24 to 26 on the higher side. So, I think he should
23:09follow now 16 rupees as a stop loss if he's still holding the position in Jayprakash.
23:14Okay. Interesting question coming from Rohan. He's writing about NTPC. And he's also asking
23:21about Avinash sir, NTPC Green IPO, which is expected in the second half of the current
23:27financial year, somewhere around November perhaps. If he's looking to play the power
23:31generation theme in India for the long term, would you suggest NTPC or would you suggest
23:36waiting for and investing in the IPO of NTPC Green? I think my guess is NTPC could be a better
23:44choice because NTPC Green is keenly awaited and we all know what is the kind of response for most
23:52of the green and renewable energy company IPOs. So, it's difficult to take a call whether he
23:58would be able to get an allotment. But in case NTPC gives some sort of allocation quota to their
24:05shareholders to invest in this IPO, that would be a kind of bonanza. Of course, we don't know
24:09whether it will happen or whether it will not happen. But on the core business, NTPC continues
24:13to do well. Just buying NTPC for the sake of NTPC Green would not be a good investment decision. So,
24:20I think if his mind is only for NTPC Green, then I think it's better that he waits for the IPO.
24:26But otherwise, NTPC prima facie looks to be an interesting bet in the power generation space.
24:30And I think next couple of years, definitely a good decent risk reward can come.
24:34All right. Avinash, there's another question for you. This one's from Vishwanathan Nair,
24:38who's writing in from Cochin, which is a better stock to buy, Jio Finance, Poonawalla, or Five
24:45Star? I think it all depends on what kind of timeframe you have in mind. You have the next
24:51two to three years, then I think Jio Finance looks better. Otherwise, the current momentum,
24:55if one wants to play the current momentum, then I think Poonawalla Finance looks quite
24:59ideally positioned. It has got a good mix of both SME as well as frontline kind of customers.
25:07And most importantly, the book has been growing quite strongly. The asset quality has been
25:11maintained well. So, I think if somebody has a 12 to 15 month horizon, Poonawalla Finance can
25:16definitely do well. We are expecting some rate cuts to happen. So, that also could play some sort
25:21of benefit to the company. But from our next two to three year kind of timeframe, any correction,
25:28one should definitely accumulate Jio Finance because I think this is one company where
25:32you're going to see a lot of disruption happening over the next two to three years. So, I think
25:36Jio Finance is slightly longer term, but Poonawalla Finance can fit the bill
25:39if somebody wants to take a 12 to 15 month time. Okay. Slightly longer term timeframe on RVNL and
25:44a lot has been said about the fundamentals of this particular counter. This is from Partha
25:48and I'm going to come to you on this one, Rajesh. Would you suggest a fresh entry at 622 for the
25:53long term? So, overall structure is bullish. I think at 622, yes, he may add some quantity here.
26:03If in volatility, if you get further downside opportunity in the stock towards 600 or 580,
26:10that would be again an attractive level to add more quantity. The way stock has holding the
26:16ground at higher level, we believe that if it's not give any kind of corrective move in volatility,
26:21then possible target towards 660 to 680 would be there in the short period of time. Very strong
26:27buying action in the stock has taken place in last couple of weeks. So, we believe that there
26:33is a high possibility that rally can extend. So, at this juncture, he can add some position,
26:39even in decline also he made, your stop loss should be placed at around 570 rupees
26:44and on the higher side 660, 670 would be the next target. All right. Thank you so much, Rajesh,
26:50for that and thank you so much, Avinash as well for joining us on the show today. It was a pleasure
26:54having you both on the show. And viewers, thanks for tuning in. Do keep writing to us your questions
27:01and don't go anywhere. There's lots more lined up for you on NDTV Profit.
27:24So,
27:54thank you.
28:24Thank you.
28:54Thank you.
29:24Thank you.
29:54Thank you.
30:15The case for the chat for a conversation with JSW Energy is about the Q1 earnings. The profits
30:20have risen 84% YOY and EBITDA has seen an expansion, but also that they've received
30:25new LOS for solar power projects. And of course, based on what they've done in terms of the capacity
30:31additions, the street believes that all of the targets could well be advanced. So, lots, lots
30:38to talk to Mr. Sharad Mahindra. He joins in right now. Mr. Mahindra, good having you. Thanks for
30:43joining in. Congrats on what seemed like a good quarter though. Optically, the revenue numbers
30:48were lower than the Bloomberg estimates, but very good operational performance, good capacity
30:53additions as expected, and good performance. Is there a missing link in the quarter,
30:59maybe on the revenue side or maybe something else, or are you happy overall?
31:03Thank you. In fact, the revenue if you see is primarily because of the in the thermal space,
31:10when we see the coal prices, coal prices as compared to last year quarter one have moderated
31:17one, which is actually a pass-through. And also, maybe a part of our thermal generation,
31:24which moved to job work for our captive customer also resulted in. So, revenue is basically any
31:32change in the coal prices is a pass-through. So, it doesn't have any impact on the results.
31:38Okay. So, the fact that both Vijayanagar and Bamar plants saw the lower utilisation,
31:45plant outage, did that have a bearing too? And of course, please do tell us if you believe
31:53that whether most of this would be made up as the year progresses.
31:58Yes, if we talk of Bamar wherein normally in quarter one, when we go for the major maintenance
32:07of the plant results in a lower PLF. So, but yes, we are absolutely confident that we will be
32:17achieving the desired PLF in the balance part of the year. And our whatever we are deemed PLF
32:25of 80% will be achieved. As we are talking, our PLFs are in the range in the current month of July
32:33in excess of 90% in Bamar plant. So, we are confident that we'll be achieving the desired
32:38and the targeted numbers of PLF in the balance part of the year.
32:41Regarding Vijayanagar, as you asked, Vijayanagar, we see that there have been
32:48issues related to water availability, which resulted in lower operations. But yes, in early
32:55July, the water supplies have normalised. So, we expect the PLF in Vijayanagar also
33:00going forward will be higher than what we have seen in quarter one.
33:04Got it. So, this generation upticks that we've seen, net generation up 18%,
33:10renewable energy generation up 44%. You're running slightly ahead of what was anticipated.
33:18You reckon that would be the case for the rest of the year as well, Mr. Mahindra, part one is that.
33:23And part two on the capacity additions, because again, I think we had conversation maybe 15-20
33:29days back when you were citing to this, but it's now been delivered in quarter one,
33:33you think that's the run rate that you keep up for the rest of the year as well?
33:37Yes. First, I'll come to in terms of the generation growth, which we have witnessed.
33:42If we see the demand growth, after witnessing a healthy demand growth in the country of 7.5%
33:49in last fiscal, current year quarter one, the demand growth has been 11%,
33:54which is a very healthy power demand growth, which is primarily driven by we see the growth,
34:03higher growth in the manufacturing sector, and also the extreme weather conditions,
34:07especially in northern part of the country, which witnessed a 22%
34:12demand growth in quarter one, as compared to last year. As compared to 11% country's growth,
34:18demand growth, our generation growth has been 18%, which has been primarily driven by
34:25very, very good generation in the hydro energy space, where we have grown by generation has
34:31grown by 61%. At country level, if we see the hydropower generation has remained muted.
34:37But on the Sutlej Basin in Himachal, where our karcham and baspa plants are located,
34:43there the generation growth has been 38% hydropower generation. With our better reliability
34:49and maintenance of the equipments and the availability, we have witnessed a growth of
34:5461% generation on Sutlej Basin in our plants. Along with that, the new capacity additions of
34:59wind which we have commissioned during the quarter, and also the better machine availability
35:05of the existing assets in this quarter, these all with some merchant demand growth in the thermal
35:15sector, these are the prime factors which have resulted in 18% generation growth for us during