Siddhartha Khemka of Motilal Recommends 2 Auto Stocks To Buy Today; Here’s Why

On Wednesday, the Nifty opened steadily but soon began to decline and ultimately closed at 19671 levels, down 140 points (-0.7%), close to the day's low. While DIIs bought Indian equity shares at Rs1470 crore, FIIs sold off Indian equities worth Rs1832 crore. Gift Nifty is now down 0.16 per cent, or 30.5 points, at 19,563 as of Thursday, October 19, 2023 8:51 AM, suggesting that domestic signals are unfavourable for the Indian market.

Market Outlook Today

Siddhartha Khemka Head - Retail Research and Chandan Taparia-Derivatives & Technical Analyst of Motilal Oswal said, "Geo-political tension in gulf region, US 10-Year bond yield surging to fresh 16-year high to above 4.90%, lower than expected US Housing data, surging oil and gold price to 1-month high and sharp decline across the global markets over 1% each, may open on domestic market on a weak note."

"Lower than expected US housing data, concern of underwhelming US earnings, spiked in US 10-Year to above 4.90% and ongoing fighting in the Middle East pulled down the US market upto 1.60%. Asian markets fell over 1% due to surged global bond yields and second largest property major in China - Country Garden unlikely to make interest payment on its offshore debt. Back home, Gift Nifty fell by 0.5%.Traders focus on auto stocks after Bajaj Auto announced strong Q2 results. US Fed Chairman speech and US listed TSMC quarterly results will be in focus today," said the analysts of Motilal Oswal.

Nifty Outlook Today

"Nifty immediate support at 19550 then 19450 zones while resistance at 19750 then 19850 zones. Now till it holds below 19700 zones, weakness could be seen towards 19550 then 19450 zones whereas hurdles are placed at 19750 then 19850 zones," the analysts of Motilal Oswal added.

Bank Nifty Outlook Today

"Bank Nifty support at 43600 then 43500 zones while resistance at 44250 then 44444 zones. Now till it holds below 44250 zones more weakness could be seen towards 43600 then 43500 levels while on the upside hurdle is seen at 44250 then 44444 marks," the research and technical analysts of Motilal Oswal said.

Stocks To Buy Today

Siddhartha Khemka Head - Retail Research and Chandan Taparia-Derivatives & Technical Analyst of Motilal Oswal has recommended the below stocks to buy or sell today on 19th October 2023.

Technical Pick:

Tata Motors

Buy at CMP of Rs 667, stop-loss: Rs 650, target: Rs 700, duration: 2 to 3 days.

Tata Motors has given falling supply trend line breakout on daily chart and managed to hold above the same. It has formed a bullish candle on daily scale and perfectly respecting 50 DEMA which indicates positive bias. The momentum indicators RSI is positively placed and supports are gradually shifting higher

Fundamental Pick:

Bajaj Auto

Buy at CMP of Rs 5137, duration: 1 year, view: Positive

The company's 2Q revenue/EBITDA/PAT grew 6%/21%/20% YoY to INR107.8b/INR21.3b/ INR18.4b. Volumes declined 8% YoY. However, ASPs grew ~15% YoY to INR102.3 per unit (est. INR101.35k) due to a better product mix (higher share of 3Ws). BJAUT's 2QFY24 EBITDA margin beat our estimate at 19.8% (+260bp YoY), led by favorable RM costs and a better product mix (high 3W contribution).

The domestic 2W industry is likely to grow 12-15% YoY during the festive season. A sequential recovery in exports and healthy demand in 3Ws should lead to a healthy operational performance. BJAUT is now exploring multiple routes to pay shareholders, including dividends and buybacks. The new slab for the dividend payout for over INR150b surplus funds is now >70% (v/s 90% as per old policy), said the analysts of Motilal Oswal.

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.