EquiChain Wealth

KOTAKBANK @ 1682 Some times bad news provide opportunity at bargain level. Equichain valuation matrix - coved on 7-May-24 after its decent result and positive management commentary. Disclaimer: https://equichainwealth.com/wp-content/uploads/2024/01/Disclosure-on-Advice-Equihain-Wealth-Advisors.pdf

Nifty @ 22375 & Banknifty @ 47825 & VIX @ 20.23 We continue to maintain our view and strategy of current allocation around 75% - 80%. Defense / Infrastructure / Banking - are key sector that we are bullish on with a view on election result. Defense stocks continue to trade near fresh life-time high - we have not made any major changes in our positional portfolio & allocation. IT sector - remain neutral with view on U.S. interest rate. We would prefer to follow capital allocation strategy rather than chasing market movement for next 2 - 3 weeks, till election result. Disclaimer: https://equichainwealth.com/wp-content/uploads/2024/01/Disclosure-on-Advice-Equihain-Wealth-Advisors.pdf

Equichain Valuation Matrix – General Election 2024 result Today we will focus on one of the important factors of valuation matrix that is general election result outcome. We will discuss few points from 2004, 2009, 2014 & 2019 election and how market is preparing itself ahead of 2024 election result on 4-Jun-24. Election result 2024 – Key valuation matrix • Stable government helps in bringing investment and policy are stable and continuity is important for attracting long term investment. • Since 2014, NDA government has focused on Make in India and domestic manufacturing which has provide huge stability in times of geo-political crisis and COVID-19. • Change in government will lead to change in policy and priority which will lead to disruption in near term. Market after 4 phases of voting complete & 3 phases voting is pending 4th phase of voting was completed on 13-May-24 as voting is now completed on around 70% seats and 30% will go to vote in next 3-phase. SATTA Bazar expecting around 300 for BJP and 330 for NDA triggered profit booking in market as indices are down by around 5% from its recent high. Equichain Wealth Advisors – Market view and opinion Market working on potential election result outcome and its impact on market • NDA 430 +: Indices could rally 10% • NDA 400+: Indices could rally 5% - 7% • NDA 375 +: Indices could rally 2% - 5% • NDA 350 +: Remain stable to positive with no of BJP seats in focus • NDA 330 & BJP 300+: Indices could trade in range of +/- 3% • NDA 272 – 300: Indices to correct by 5% - 7% • NDA lose: Market in panic mode These are some of the hypothetical scenarios and market has turned positive after Mr. Amit Shah statement of comfortable victory for NDA and BJP will manage to cross 370 seats by its own. We would prefer to keep investment level around 75% to 80% and follow capital allocation strategy with positive view on market and election outcome and still follow strategy for long term view. Disclaimer: https://equichainwealth.com/wp-content/uploads/2024/01/Disclosure-on-Advice-Equihain-Wealth-Advisors.pdf

Nifty @ 22091 & Banknifty @ 47703 & VIX @ 20.60 A statement by Amit Shah has turned indices positive ...................expect such volatility to continue as we expect decisive move only after 20-May-24 - 5th phase of voting. Portfolio allocation - 75% to 85% Cash 20% - 25%.? Bullish on - Defense, Infrastructure & Banking View on IT bullish with neutral weight - due to global factor / Interest rate. We would prefer to take any fresh trade / short position on long side only. In case of cautious view - we will increase cash level...................play long. https://equichainwealth.com/wp-content/uploads/2024/01/Disclosure-on-Advice-Equihain-Wealth-Advisors.pdf

Nifty @ 21891 & Banknifty @ 47134 & VIX @ 21 We would prefer to follow capital allocation strategy. Recent weakness is mainly due to nervousness due to election result outcome. Market is preparing itself for volatile binary event on 4-Jun-24 - Election result

Indices indicate sideways trend as Nifty range for this week is seen from 22117 to 22795 and Banknifty range seen at 47824 to 49807. VIX move towards 16 and above could trigger further volatility. We believe market should turn extra cautious if Nifty @ 22117 & Banknifty @ 47824 breaks on downside. We expected upside to be capped and Nifty @ 22775 & Banknifty @ 49807 to act as resistance level. — from weekly report Nifty @ 22134 & Banknifty @ 47707 & VIX @ 17.68 Indices are trading near lower end of the range and it will be important for market to hold on to this level. We see market reaction will continue to take cues from ongoing general election based on percentage of voting and probability of BJP & NDA securing how many seats. We expected clear & decisive move only after 5th phase of voting is completed - that is on 20-May-24. Meanwhile - we would prefer to keep exposure around 75% to 80% invested & 20% - 25% on liquid to take advantage of big swings on either way. VIX @ 17.62 - is due to increase in VIX for Nifty Out-of-Money premium going into election result on 4-Jun-24.

BHARATFORG @ 1350 Reacting to positive result & Commentary. Market view remains positive.

LT @ 3450 We remain bullish with election result view and will waiting for result today. We see this correction as good level to add fresh. We maintain capital allocation strategy. Disclaimer: https://bitly.ws/3a3Tg

Equichain Valuation Matrix – KOTAKBANK @ 1624.30 (closing – 6-May-24) This week will review KOTAKBANK which has corrected after RBI put restriction on fresh account through online business. Although it will not impact existing customer base as well as offline business model, stocks price has reacted sharply negative. Management Commentary Kotak Mahindra Bank is more worried about reputational impact than the financial impact due to the Reserve Bank of India's curbs, said Chief Executive Officer and Managing Director Ashok Vaswani. RBI's order has had an impact on the franchise and reputation, he said. In particular, the credit card business and Kotak 811 will be the most affected. Price Action post RBI restriction & Q4FY24 result • KOTAKBANK corrected by 10% on reacting to RBI restriction. • KOTAKBANK trades at 3 and half year low as joint MD – KVS Manian resigns. • KOTAKBANK – Q4FY24 result declared on 4-May-24 and stock price recovered on better result to trade back above 1600. Equichain Valuation Matrix: KOTAKBANK We believe, it is time to accumulate KOTAKBANK as we don’t see structural problem and underperformance in last 3 years. KOTAKBANK at its peak around 2100 – 2200 was trading around 5 to 5.5 times its book value which is currently trading around 3 times to its Book value. We see recent development as negative for KOTAKBANK apart for Q4FY24 result which provided some relief. We would like to believe that valuation is attractive and with investment view on 12 months or more, we see current level as accumulation phase. Click on the attachment to read the full report posted above 👆👆 Disclaimer: https://bitly.ws/3a3Tg

Fresh buying to be preferred around lower end of the range - Nifty @ 22117 & Banknifty @ 47824 - for portfolio where exposure is around 75% - 80%. — Yesterday's post

Nifty @ 22475 & Banknifty @ 48952 & VIX @ 16.86 No change in strategy - as mentioned yesterday. VIX at elevated level and will continue to remain at higher level as market is expecting high volatility around general election result. We prefer to go by our capital allocation strategy. Disclaimer: https://bitly.ws/3a3Tg

Indices indicate sideways trend as Nifty range for this week is seen from 22117 to 22795 and Banknifty range seen at 47824 to 49807. VIX move towards 16 and above could trigger further volatility. We believe market should turn extra cautious if Nifty @ 22117 & Banknifty @ 47824 breaks on downside. We expected upside to be capped and Nifty @ 22775 & Banknifty @ 49807 to act as resistance level. View from weekly report Fresh buying to be preferred around lower end of the range - Nifty @ 22117 & Banknifty @ 47824 - for portfolio where exposure is around 75% - 80%. If exposure below 75% - Can bring exposure around 80%. We continue to follow capital allocation strategy with stock specific approach. Infrastructure & Defense still remains best bet - IT turning out to be contrarian buying opportunity after recent U.S. Economic data which was weak and raised hope of rate cut. Disclaimer: https://bitly.ws/3a3Tg

Nifty @ 22500 & Banknifty @ 49021 & VIX @ 16.25 VIX - moving above 16 - is building on risk premium ahead of general election result. Avoid chasing momentum & prefer to be selective while having stock specific approach. Keep investment around 75% to 80% to have balance approach. Disclaimer: https://bitly.ws/3a3Tg

Last week – review This week started with market reacting to ICICIBANK positive numbers and KOTAKBANK continues to decline as joint MD KVS Manian. Nifty tested new high and made double top around 22775 level, market corrected sharply on Friday on profit booking and VIX moved higher to close the week at 14.62 Vs 10.92 from previous. Week. U.S. market gained around 1% on major indices U.S. Fed kept rate unchanged commentary was neutral. U.S. Fed chair Jerome Powell ruled out rate hike was cherished by market. Technical Insight Nifty around 22775 – 22800 has made double top and continue to act as resistance level. Nifty on Friday witness negative sharp reversal as RSI @ 52.83 & RSI average @ 55.30. Nifty @ 22117 likely to act as support level and 22775 to act as resistance level. Banknifty on chart is strong as compared to Nifty, but short-term trend looks weak after 3 days of negative close. Banknifty @ 47824 to act as support level while 49600 to act as resistance level. Indices indicate sideways trend as Nifty range for this week is seen from 22117 to 22795 and Banknifty range seen at 47824 to 49807. VIX move towards 16 and above could trigger further volatility. We believe market should turn extra cautious if Nifty @ 22117 & Banknifty @ 47824 breaks on downside. We expected upside to be capped and Nifty @ 22775 & Banknifty @ 49807 to act as resistance level. Fundamental Insight 1) Government To Buy Back Sovereign Bonds Worth Rs 40,000 Crore 2) Eight Core Industries Grew By 5.1% In March 3) GST Monthly Collections Cross Rs 2 Lakh Crore For The First Time In April 2024 4) India's Forex Reserves Fall By $2.41 Billion, Marking Third Consecutive Weekly Decline Equichain Wealth Advisors: Market View & Strategy Two phase of voting is completed and 3rd phase of voting is scheduled on 7-May-24 followed by 4th phase on 13-May-24 and 5th phase on 20-May-24. We expect market to take decisive directional move only after 5th phase of voting is completed. In next few weeks, we would prefer to keep exposure around 75% to 80% and keep exposure level slightly towards positive bias while keeping cash balance as any major correction due to election result could provide buying opportunity. We would maintain balance approach till 4-Jun-24, election result day. Click on the attachment to read the full report posted above 👆👆 Disclaimer: https://bitly.ws/3a3Tg

Global Market – U.S. Fed meeting & U.S. Economic data & Earnings in focus. This week, we will discuss U.S. Fed meeting outcome on 1-May-24 and key U.S. Economic data released this week and highlight of the data which is released on Friday which came below market estimate and market reaction to weak economic data was positive as it rises hope of rate cut. We would also focus on APPLE ‘s earnings which has boost sentiment for technologies companies. U.S. Economic data 29-Apr-24 to 3-May-24 U.S. CPI & Core CPI data released 10-Apr-24, which came above market estimate has changed market sentiment and rate cut expectation from June 2024 meeting was pushed to September 2024 meeting. As we begin new month non-farm employment change and average hourly earnings released on 3-May-24 came below estimate and market reacted positive to weak set of economic data. Fed fund rate monitor tool indicating slightly increasing in probability for rate cut in September 2024 Fed meeting. U.S. FOMC meeting on 1-May-24 - Outcome • U.S. Fed keeps interest rate unchanged at 5.25% - 5.50% - keeps rate steady for 6th time. • Inflation eased over past year but remains sticky, remains high above target rate of 2% - Powell • U.S. Fed statement indicated rate could remain higher for longer period. Inflation data received this year has been higher than expected. U.S. Market rallied after dovish stance maintain by U.S. Fed as any rate hike is ruled out and incoming economic data, particularly jobs data and CPI & Core CPI data in coming months to provide further cues. Apple shares rise more than 5% premarket after Q2 results top downbeat estimates • Apple - revenue at $90.8 billion Vs estimate of $ 90.32 billion. • Apple - EPS $ 1.53 per share Vs estimate of $1.50 per share. • Apple share price was up by 7% on reaction to result on Friday. • The company also announced a $110B stock repurchase program and hiked its dividend by 4% to $0.25 a share. Equichain Wealth Advisors: Market View & Opinion We see U.S. Fed meeting on 1-May-24 outcome to have limited to positive impact on Indian market as our market will shift its focus to earnings for companies which are yet to declare result and general election. PSU 's will continue to remain in focus in near term. We continue to believe that market will continue to trade in range with focus remain on U.S. economic data and expectation of interest rate. Last comment from U.S. Fed chair Jerome Powell mentioned that interest rate to remain higher for longer period. We do not expect any decisive market move in coming few weeks. Click on the attachment to read the full report posted above 👆👆 Disclaimer: https://bitly.ws/3a3Tg