Nifty outlook and few trading ideas by Prabhudas Lilladher

STOCK MARKET - Nifty outlook and few trading ideas by Vaishali Parekh, Research Analyst - Technical Research at Prabhudas Lilladher:

NIFTY VIEW:
Markets witnessed a volatile session to see a dip midway by way of profit booking activity but finally in the last leg of the session saw short covering to close on the positive side. The support for the day is seen at 10180 while resistance is seen at 10320.

BUY MAH INDRA& MAHINDRA
CMP: Rs 1,431.60
TARGET: Rs 1,510    
STOP LOSS: Rs 1,380
The stock has been moving in an upward trend with a series of higher bottom formation pattern in the daily chart and technically is poised for further gains in the coming days. With the indicators looking favourable thus supporting our view of a positive bias,  we anticipate a price rise in the stock and with decent volume participation witnessed,  we recommend a buy in this stock for an upside target 1510 of keeping a stop loss of 1380

BUY L&T FINANCE HOLDINGS
CMP: Rs 163.75    
TARGET: Rs 180    
STOP LOSS: Rs 150
The stock has witnessed a decent correction in the recent past and we anticipate a bottom formation has been maintained at current levels. We expect a rise from here on to scale till 180 levels with potential. With good volume activity seen, Disclaimer: The analyst may have positions in any or all the stocks mentioned above, we recommend a buy in this stock for an upside target of 180 keeping a stop loss of 152

L&T Finance falls on buzz that Citigroup is selling stake

L&T Finance Holdings Ltd fell as much as 3.9 per cent in early trade to its lowest level in a week on the buzz that Citigroup was planning to sell 39.2 million shares, or 2.15 per cent stake in the company, worth Rs 737 crore, according to an IFR report.

Citigroup, according to the report, is selling shares in the range of Rs 180.50-188.05 apiece, a discount of as much as 4 per cent to the stock's Monday close.

More than 33 million L&T Finance shares would be changing hands on the NSE in a single block deal, besides several other block deals in stock.

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L&T Finance Holdings hits record high on stellar Q1 results

STOCK MARKET - L&T Finance Holdings (LTFH) hit its record high of Rs 170, up 6%, extending its 4% gains on BSE, after reported 49% year-on-year (YoY) growth in consolidated net profit at Rs 309 crore in June quarter (Q1FY18),led by strong earnings momentum in housing and investment management business. The company had a profit of Rs 207 crore in a year ago quarter.

“Assets quality of the company also improved with gross non-performing assets (GNPA) has reduced by 18% - from Rs 4,519 crore to Rs 3,698 crore. With improved provision coverage, NNPA% has seen a sharp reduction from 5.02% in Q4FY17 to 3.31% in Q1FY18,” LTFH said in a release.

Return on Equity (RoE) improved by 385 bps – 13.63% in Q1FY18 as against 9.78% in Q1FY17.

“With increase in profitability supported by a strong balance sheet, I believe that we are now at a juncture, where the strategic roadmap towards a top quartile RoE can be accelerated by “Growing Fearlessly”,” said Dinanath Dubhashi, Managing Director & CEO, LTFH.

Over past five quarters LTFH has shown commendable progress on its well articulated strategy. Cost control, increased sell down and strengthening the digital/analytics capabilities remain the key focus area even as the company aims to achieve top quartile RoE by 2020 or "earlier", according to analysts at Antique Stock Broking.

So far in 2017, the stock has outperformed the market by surging 95%, as compared to 22% rise in the S&P BSE Sensex.

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