Chandan Taparia of Motilal Oswal Recommends 2 Stocks To Buy Or Sell On Wednesday, 5th July

The Nifty ended with a gain of 66.45 points, or 0.34%, at 19,389 after reaching its record high of 19,434.15 in intraday trade on Tuesday trading session, while the Sensex ended 274 points, or 0.42%, higher at 65,479.05. Benchmark indices opened flat on Wednesday with the Sensex rising 60 points to 65,542, the Nifty 50 remaining unchanged at 19,406, and the Nifty Bank remaining steady at 45,505. While the Sensex is able to maintain its level of 65,495, the Nifty 50 index is down 20 points. During Wednesday's opening session, the Nifty Bank began the day more than 100 points down.

Commenting on the outlook of Nifty today, Chandan Taparia, Derivatives & Technical Analyst of Motilal Oswal said, Nifty immediate support at 19250 then 19100 zones while resistance at 19450 then 19500 zones. Now it has to continue to hold above 19300 zones to extend the move towards 19450 and 19500 zones while on the downside support shifts higher at 19250 and 19100 zones.
"Bank Nifty support at 45000 then 44750 zones while resistance at 45500 then 45650 zones. Now it has to continue to hold above 45000 zones for an up move towards 45500 then its recent life high of 45650 zones while on the downside support shift higher at 45000 then 44750 levels," he further added by commenting on the outlook of Bank Nifty on Wednesday.

Market Outlook

"Upbeat quarterly earnings update by corporates, persistent FIIs inflow and impressive domestic economy data may open domestic market on a positive note. U.S. markets closed yesterday for the Independence Day holiday. European stocks edged marginally lower in thin trading as investors looked ahead to the monthly report on US employment for clues how high interest rates will rise this year. UK, France and Germany Index slipped 0.2% each. Asian equities opened lower today in subdued trading following a holiday for US markets. Stocks marginally fell in Japan, South Korea, Hong Kong and Australia, along with futures for the S&P 500 and Nasdaq 100. US nonfarm payrolls data will be announced on Friday, which may offer fresh hints on the Federal Reserve's monetary-policy path. Brent crude spiked to 2-week high at above $76/bbl is a concern. Gift Nifty is flat to positive," said Chandan Taparia.

Stocks To Buy Today

Chandan Taparia, Derivatives & Technical Analyst of Motilal Oswal has recommended 2 stocks to buy today i.e. on Wednesday, 5th July.

Technical Pick:

ITC

Buy at the current market price of Rs 466, stop-loss: Rs 459, target price: Rs 480, timeframe: 2-3 days

ITC has given triangle breakout on daily scale and holding well above the same. Buying is visible across FMCG Space which will support the up move. It is forming higher highs- higher lows from the past four sessions which indicates a positive trend. The momentum indicators are placed in the positive territory which will take the prices to higher zones, said Chandan Taparia.

Fundamental Pick:

Samvardhana Motherson

Buy at the current market price of Rs 85, target price: Rs 102, timeframe: 1 year

MOTHERSO, via SMRPBV, has agreed to acquire an 81% stake in Yachiyo (Honda 4W component business). Yachiyo is the supplier of sunroofs (9% global market share), fuel tanks and bumpers. MOTHERSO would pay ~EUR117m equity value for an 81% stake, with Honda retaining a 19% stake. The acquisition is expected to be completed by 1QFY25. It will enable MOTHERSO to cross-sell its products to Honda and offer Yachiyo products (sunroofs and fuel tanks) to other OEMs. The Yachiyo acquisition is very attractive ~1.5x Equity/EBITDA, and hence it is expected to be EPS/RoCE accretive from the first year (FY25). More importantly, it adds two lines of business (sunroofs and fuel tanks), and makes Honda a sizable customer for MOTHERSO (6% of consol. revenues vs. 1% earlier), said Chandan Taparia.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.