The last trading day of the September month and we would be putting an end to the 2nd quarter of this fiscal and as we enter into the third quarter, which is a festive quarter we have a lot of expectations that the festive season will revive the economy and bring back the growth again. The September sales data will come tomorrow and we have the RBI monetary policy on 4th October and all this are going to be the triggers for further growth.
On the global front, Dow Jones, after falling a lot intraday, recovered to close just 70 points down. Asia today is also looking flat, mainly on the back of contraction in manufacturing data from China, coming in at 49.8 for September. As a result, Japan is down 60 points while Hong Kong is totally flat up 16 points.
On the domestic front, there is some feel-good factor as the IRCTC IPO kicks off today. We are all used to booking train tickets on IRCTC for almost 18 years and now the company is going to be listed on markets. The issue opens today and closes on 3rd October. The price band is 315-320 rupees with issue size aggregating to 645 Cr. On the revenue front, IRCTC has revenue of 1956 Cr and a PAT of 272.5 Cr. Catering amounts to 55% of its revenue while ticketing contributes to 23%.
But margin wise ticketing accounts to 60-65% margin while catering contributes roughly 12% to the margins. A lot of buzz will be around this IPO and for Nifty today the range will be the 100 dma of 11410 on the downside and on the upside 11695 which is the highest level for this rally.
On the derivative front, Friday saw some selling on futures and this has brought the long positions from 34% to 33% and even in the options also, there was more demand for the calls than the puts, as put-call ratio dropped to 1.13 from 1.31. This week is a truncated week with Wednesday being a holiday and we have now just 2 trading sessions left before the weekly expiry on 3rd.
On Friday 11400 put added 4.3 lakh positions while 11300 put added 3.4 lakh positions and 11500 put has the highest open interest for this week’s expiry. On the call side, 11600 call added 10 lakh positions while 11700 call added 6.2 lakh positions and 11600 call has the highest open interest for this week’s expiry. So, the range is narrow between 11500-11600 mark and today’s movement will decide where Nifty goes.
What is the Nifty call for the day?
Friday, saw Nifty holding on to 11500 mark which was very crucial level and today, like other Asian markets, we are likely to open flat around 11500-11520 mark and on the downside 11450-11480 will offer strong support.
The trade for the day is to go long if Nifty holds on to this level with 11550-11580 as the target. Nifty has a potential to touch 10695 mark in the next couple of trading sessions and that makes you safe to take this long position today. But just in case, Nifty drops below 11450 mark and then goes to 11420 and below then I would suggest to hold on and not to take any positions.