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The Union budget next month and global developments around US-Iran geopolitical tensions are key focus areas of markets in the ongoing derivatives series.
Oil marketing companies are seeing traders trimming their bullish bets and adding short positions due to the US-Iran tensions while stock-specific reasons have impacted Sun TV Network and Titan Company.
ET takes a look at 5 stocks which are seeing a large build-up in the January derivatives series and details their near-term outlook.
JUBILANT FOODWORKSCMP in: Rs 1,682.75
Change in OI in Jan series so far: 35.8%
Change in share price in Jan series so far: 5.4%
Traders are turning bullish on the stock as competition from food tech apps is reducing.
“Food tech apps are facing issues from restaurants delisting.
They are also facing issues on commissions that they are charging restaurants.
“Competitive intensity from food tech apps has reduced, which is positive for Domino’s,” said Abneesh Roy, senior VP, institutional equities at Edelweiss.
Chandan Taparia, derivative analyst at Motilal Oswal said the stock is likely to rise 8-10% in the immediate term.
SUN TV NETWORKCMP in: Rs 430.10
Change in OI in Jan series so far: 34.1%
Change in share price in Jan series so far: -3.4%
Bearish positions were built in the stock futures of Sun TV as Trai recently made amendments to the new regulatory framework for cable and broadcasting services under which cable TV users will be able to access more channels at a lower subscription price.
The trend is negative on technical charts as the stock has been making lower top-lower bottom and shorts are intact, said Taparia of Motilal Oswal.
“It has hurdles at 445 zones while weakness can drag it towards 410 levels,” said Taparia of Motilal Oswal.
INDIAN OIL CORPORATIONCMP in: Rs 126.85
Change in OI in Jan series so far: 19.8%
Change in share price in Jan series so far: 1.4%
Traders have built short positions as well as unwound long positions in the stock futures of Indian Oil Corporation in the January series as crude oil prices spiked due to rising geopolitical tensions in the Middle East after a US airstrike killed Iranian General Qasem Soleimani.
The medium-term trend is in pressure but it is turning from key support of Rs 120 zones, said Chandan Taparia of Motilal Oswal.
“Some bounce may be seen towards Rs 135 with major support below Rs 120 zones,” said Taparia.
TITAN COMPANYCMP in: Rs 1139.7
Change in OI in Jan series so far: 16.9%
Change in share price in Jan series so far: -4.43%
Titan has seen a build-up of short positions in the current derivative series.
According to reports, Tata Group firm, on Saturday, said its December sales were hit because of protests in North East and other parts of country.
“Performance remains subdued due to weak market dynamics.
Jewellery segment, which had started on a good note starting 3Q, slowed down later,” said Phillip Capital.
Titan could see some bounceback on Monday as Street was expecting jewellery revenue growth to be lower than 10% in Q3 of FY20.
APOLLO HOSPITALSCMP in: Rs 1486.10
Change in OI in Jan series so far: -16.4%
Change in share price in Jan series so far: 7.7%
The company recently said that the Irdai has approved HDFC’s bid to acquire 51.2% in Apollo Munich Health Insurance Company.
This has led to short-covering in the counter.
“The net cash proceeds should be utilised by promoters to pare its personal debt and reduce its pledge to 20-25% (from 58%), in line with its guidance.
At company level, this transaction along with the SAP business restructuring (expected completion by March 20) should generate Rs 600 crore cash, which should help in improving its balance sheet,”said Morgan Stanley.
