V-Guard, Ujjivan, Apollo top momentum picks in June series

With political uncertainity easing, traders are focusing on corporate earnings and expected policy action from the new government. ET takes a look at five stocks that are gaining momentum in the stock futures segment in June series.

V-GUARD INDUSTRIES
CMP: Rs 243.3
OI change in June series (%): 32.2
Spot price change (%): 3.4

V-Guard Industries’ profit in the fourth quarter increased 115% over the corresponding period of previous year to Rs 59.24 crore, prompting bullish bets in the counter. Despite the strong fourth quarter performance, brokerage Anand Rathi has retained sell rating on the stock and cut target price to Rs 184 from Rs 187 as valuations are expensive. The brokerage expects V-Guard’s profit to see a compounded growth of 17% over FY19-FY21.

APOLLO HOSPITALS ENTERPRISE
CMP: Rs 1,332.2
OI change in June series (%): 16.1
Spot price change (%): 10.75

Investors are building bullish bets in the Chennai-based hospital chain’s futures as its consolidated profit more than doubled from year ago levels to Rs 84.4 crore in the March quarter. “The stock has given a consolidation breakout and is trading near six montth high. The momentum can extend to Rs 1,380 in the near term and it is likely to find support at Rs 1,300,” said Chandan Taparia, derivative analyst at Motilal Oswal.

ITC
CMP: Rs 279.25
OI change in June series (%): 16.55
Spot price change (%): -3.26

Investors have been nervous about ITC following the appointment of Harsh Vardhan as Union Health Minister. CLSA said efforts to implement past unfinished agenda such as plain packaging and restriction on point-of-sale ads could impact the industry. Harsh Vardhan has also been proponent of aggressive increase in tobacco taxes, said CLSA. The stock is not likely to rise significantly above Rs 300 and one should reduce positions, said Taparia.

UJJIVAN FINANCIAL SERVICES
CMP: Rs 364.45
OI change in June series (%): 32.2
Spot price change (%): 7.1

Analysts said Ujjivan witnessed strong disbursement and loan growth in the March quarter. “The stock has formed higher top higher bottom on daily and weekly scale. As long as it manages to hold above Rs 350, it has scope to go up to Rs 385 levels,” said Taparia. Antique Stock Broking said current valuations are reasonable but re-rating will hinge on management’s ability to scale up its branch business, manage risks in MFI business and clarity around separate listing of the bank.

JAIN IRRIGATION SYSTEMS
CMP: Rs 49.2
OI change in June series (%): 13.3
Spot price change (%): -9.5

Sentiment in Jain Irrigation futures has turned bearish as its net profit declined 39.4% to Rs 56.1 crore in the March quarter. Sales declined 7% to Rs 2,583.01 crore in the three months ended March. The stock will be out of F&O from June 28. Antique Stock Broking has a buy rating on Jain Irrigation. The brokerage believes that Jain Irrigation is on the cusp of a turnaround with multiple levers for sustainable growth.