Marico Positional Call

MARICO GRAPHIC

Report dated on 23 April, 2018; Compiled by Sandip Patel

Marico Limited is one of India’s leading consumer product companies operating in the beauty and wellness space. Currently present in 25 countries across emerging markets of Asia and Africa, Marico has nurtured multiple brands in the categories of hair care, skin care, edible oils, health foods, male grooming and fabric care. Marico’s India business markets household brands such as Parachute, Parachute Advansed, Saffola, Hair & Care, Nihar, Nihar Naturals, Livon, Set Wet, Mediker and Revive among others adding value to the life of 1 in every 3 Indians. The International business offers unique brands such as Parachute, HairCode, Fiancée, Caivil, Hercules, Black Chic, Isoplus, Code 10, Ingwe, X-Men and Thuan Phat that are localized to fulfill the lifestyle needs of its international consumers. Charting an annual turnover of INR 59 billion (Financial Year 2016 – 2017) across the entire portfolio, Marico’s sustainable growth story rests on an empowering work culture that encourages its members to take complete ownership and make a difference to the entire business ecosystem.

New product launches during First Quarter of 2018

  • Saffola Edible Oil launched its new packaging with relevant benefit positioning for each of the variants derived from factors affecting heart health.
  • Exciting and super nourishing range of fruit-based hair oils under the Hair & Care brand available in two variants: Green (which contains the extracts Olive, Sweet Lime and Green Apple) and Orange (which contains the extracts of Strawberry, Orange and Pomegranate).
  • Parachute Advansed Men Range;
  • Set Wet Gels with New Exciting Packaging;
  • Set Wet Beard Gels & Cream;
  • Set Wet No-Gas & Blast

Technical Rationale

The stock is in a sloppy uptrend which has witnessed a price-wise correction after recording new high. The 50-week and 100-week moving averages have subsequently given a strong support to show a bounce back to record new highs in stock price.

Currently 50-week moving average is giving a good healthy support and a good price volume action helping to surpass the hurdle of price decline.

RSI and Stochastic have given a positive signal as both of the indicators are above the neutral line which shows a good positive trend continuation to record a new high.

MACD is trading above its average and have recently given a bullish crossover in the stock price to give a positive buy signal.

As per the Current weekly set up, I believe that the stock will move higher by utilising prior consolidation

On the higher side, the stock will face a major hurdle at Rs. 374, which is coinciding with prior high connecting trend line. However, in any case of decline, the stock will get a strong support at its 100-week moving average which is nearly placed at Rs. 295.

marico 1

Conclusion: A long position in stock of Marico limited can be initiated in the range of Rs. 315-325 with the Stop Loss of Rs. 295 and the Target of Rs. 374.

Mahindra & Mahindra positional call

Mahindra Technical

Report Dated on 20 April 2018

Mahindra and Mahindra Limited (M&M) is an Indian multinational car manufacturing corporation headquartered in Mumbai, Maharashtra, India. It is one of the largest vehicle manufacturers by production in India and the largest manufacturer of tractors in the world. It is a part of the Mahindra Group, an Indian conglomerate.

Mahindra & Mahindra, brands its products as “Mahindra”, produces SUVs, saloon cars, pickups, commercial vehicles and two wheeled motorcycles and tractors. It owns assembly plants in India, Mainland China (PRC), the United Kingdom, and has three assembly plants in the United States. Mahindra maintains business relations with foreign companies like Renault SA, France.

Mahindra produces a wide range of vehicles, including MUVs, LCVs and three-wheelers. It manufactures over 20 models of cars, including larger, multi-utility vehicles like the Scorpio and the Bolero. It formerly had a joint venture with Ford called Ford India Private Limited to build passenger cars.

Mahindra began manufacturing tractors for the Indian market during the early ’60s. It is the top tractor company in the world (by volume) with annual sales totalling more than 200,000 tractors. Since its inception, the company has sold over 2.1 million tractors. Mahindra & Mahindra’s farm equipment division (Mahindra Tractors) has over 1,000 dealers servicing approx. 1.45 million customers.

The business has a presence in almost every segment of the automobile industry with a portfolio ranging from SUVs, luxury SUVs, Sedans, Pick-ups, light, medium and heavy Commercial Vehicles to three-wheelers. Their customer base spans rural and urban India.

tractor

Mahindra and Mahindra is world’s largest tractor brand by volume, India’s largest utility vehicle manufacturer and several of our businesses enjoy leadership positions in the industries in which they operate. They remain committed to investing in technology, growing our global presence and maintaining our leadership position.

One sector that will be a big beneficiary of the government’s rural push is the tractor space of Mahindra and Mahindra.

Technical Rationale:

The stock is in the strong-up trend as it’s placed positively up from its 20, 50, 100 and 200 weeks moving average. Recently making an all-time high of Rs818.80 on 17th April 2018 by taking a good support at 20 weeks moving average.

The stock reversed after taking strong support of its 200 week moving average and currently placed above its 20 weeks moving average.

MACD is trading above its average and recently gave a bullish crossover showing positivity in stock. RSI and Stochastic is trading at a median level of 70 which is a sign of bullish trend and a trend continuation northwards.

I believe the stock will keep on moving higher and will achieve a desired Medium term target price of Rs900.

In case of any decline, the stock will get a good support at the level of 750 which is the level of its 20- week moving average. In a short term view the RSI and Stochastic may show a level of overbought which can show a short term decline in the stock price.

On the higher side, a major hurdle can be seen at the level of 900, which is coinciding with prior high connecting trend line.

m&m

Conclusion: Long position can be taken in the range of Rs 795 – 810 with the stop loss of Rs 750 and for the target of Rs 900.

 

The Dow Theory

A person watching the tide coming in and who wishes to know the exact spot which marks the high tide, sets a stick in the sand at the points reached by the incoming waves until the stick reaches a position where the waves do not come up to it, and finally recede enough to show that the tide has turned. This method holds good in watching and determining the flood tide of the stock market.” – Charles Dow

Charles Dow, also considered as the father of Technical analysis, took the analogy of ocean tides to explain the pricing of stock markets. Charles Dow gave us the first Stock Index The Dow Jones Industrial Index and The Dow Jones Rail Index. Ever since, the Dow Jones has been updated numerous times by the Wall Street Journal. Charles Dow never published a book to summarize his work, but even today his theory forms the cornerstone of the Modern day Indexes and Technical Analysis. The Dow theory was the basis to all the other Indices across the world and is also applied to Indian Indices, Nifty and Sensex.

Continue reading The Dow Theory