Sir, pls share your views on SSWL. was presuming that this is a high tight flag formation on the weekly with consolidation on low volume. Also, fundamentally, SSWL is doing extremely well with 300cr orders per month.
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Sir Whats the take on Chimalal sethia , They are also holding Cash of 240 cr, Market cap now is 900 cr with around 90 cr of inventory .
Thank you HIteshbhai as always for insightful response.
SSWL is a good flag breakout pattern. If successful, targets can be in the vicinity of 2800. Fundamentally also it has been posting superb numbers and monthly run rate is also encouraging.
@Kailasa_Tiwari I dont track chamanlal setia.
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Hitesh bhai
Do you have any views on PTC India. Their main business is similar to that of iex
Hitesh Bhai.
Are you tracking Shivalik Bimetals. Seems to be having a great 4-5 quarters and positive commentary.
Hii hitesh bhai.
You mentioned about kolte patil chart a few weeks back but due to market conditions the pattern did not pan out.
How to play such stocks in which due to market conditions the stocks do not move.
I think you are confusing KRBL with Kolte Patil. KRBL flag breakout pattern has failed . Stock price has corrected to 254, close to its 200 dema at 257. Post the results and concall, I felt the near term triggers were not expected to come quickly. I usually keep a mental stop loss of around 7 to 10% from my buy price, unless I feel that correction in price has happened inspite of good results or inspite of imminent triggers. In such situations (where near term visibility or triggers are elusive) I exit my postion partially or most often completely.
My experience in these situations has been that hope most often is an enemy of momentum investing. Once a stock loses its momentum, on the charts and often on fundamental parameters, its no use trying to hope for better things to materialise and for stock price to head higher. This is specifically meant for people practicing momentum investing. For medium to long term investors, the thesis could be different.
Taking small losses and moving on is a part and parcel of this style of investing, and as painful as taking losses may be to someone new to it, one has to adhere to the ground rules.
The current correction in broader market (indices often do not show a true picture) presents opportunities to pick up companies which show good results and have good prospects going ahead based on all the information available and concalls (if the company does concalls).
I dont track ptc india, or shivalik bimetal.
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Hitesh ji,
More of a fundamental question, but I would be very interested in knowing your view on SAIL for the long term. Severe undervaluation, and good tailwinds seem to be here, but being a PSU I cannot decide on the prospects. If you track PSUs, would appreciate your view.
What is the possibility of SAIL getting NMDC steel plant even if they don’t want since promoter is common. Like what happened with ONGC getting HPCL. Recently Tata steel said they are not interested in NMDC steel plant.
Without going into the specifics of Sail or any other steel company, I think personally for me, its very difficult to get these cycles right. And after such huge run ups, I am not too sure about how lucrative these picks could be. Even after reporting big profit numbers for past couple of quarters, i.e March, June and now Septermber, many of these stocks have not moved much. e.g Sail has not crossed its May high of 151 till now. So maybe markets knows more than us. Usually at the peak of any cycle the profits are the best. Going ahead, if steel prices were to correct for whatever reason, and with input prices at very elevated levels, we need to see how things pan out. Commentary wise, there are a lot of bullish noises from different managements of steel companies, but I consider it their business to be bullish about their companies, otherwise they cannot do business effectively. 
I prefer to look at sectors where I can see strong tailwinds with good chart structures. Some of these sectors I feel worhty to look at are PSU banks, and select PSU names, select auto and auto ancillaries, select NBFCs, select cement companies, capital goods companies, some power names etc. I wont go into the details of names, as I do not want to encourage spoon feeding, but the list of sectors gives a brief idea about where the odds of success lie, according to me. I can be wrong in my assessment, but this is a working theory I have as of now.
Conversely, sectors I would avoid as of now are the sectors gradually getting out of favour, after stellar run ups. Sectors like chemical companies, pharma, particularly the API and CDMO guys, metal (as I don’t know which way they would go), recent IPO listings with short histories, etc.
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Hitesh sir ,
i would like to ask in swing trade which pattern you prefer to trade ?
i prefer trading in break outs but many times it becomes risky as well
JSW Steel, TATA Steel reported stellar results however Stock prices went down a bit and looking weak on charts. Market thinks its peak profit and in future the cycle may/ should reverse. However, the accumulated profits from last 4 quarters will reduce debt to large extent and interest cost going forward will go down too. Its kind of indecision state as to where will metal stocks move from here.
I am invested and will pyramid up if price increases, else will exit.
@hitesh2710 ji always wonderful insights on your thread.
What would be the 1 or 2 best books you world recommend on the below topics:-
- Techno funda investing
- Picking small cap stocks early
- Comprehending valuation
- Financials analysis including understanding balance sheet etc
Thank you!
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In swing trading I prefer breakouts from tight consolidations. These consolidations can take the form of range bound rectangular or triangular patterns, or flag (slightly drooping rectangular or triangular pattern). Sometimes we get some bizzare consolidation patterns in form of expanding triangle within a narrow range. Idea should be to look out for compression of price action with shrinkage of volumes. And post this phenomenon, a breakout with high volumes. With these breakouts the most tricky part is to figure out whether there will be a pullback and retest of the breakout zone or will the stock price blast off right away. Its often difficult to differentiate between the two before hand, and hence idea should be to buy a certain quantity, say 30-50% of desired quantity on breakout and then see how things pan out.
If it gives a pull back, wait patiently for it to show signs of completion of pullback, either on daily charts with formation of doji, or bullish candlestick or wait for some kind of positive divergence on indicators, etc.
Conversely, if it keeps going up without giving pullback, add on consolidation post this rally and then take the position forward.
This execution part in swing trading is often the most difficult part as a lot of outcomes depend upon the market conditions. Few weeks/months back, most breakouts did not give any pullbacks and stock prices ran away too fast. In those times it helped to be nimble. Nowadays with a little bit of subdued momentum, there are good pullbacks from breakouts and enough time to even study the stock for a few days, both fundamentally and technically and then take a call. Plus currently there are higher chances of false breakouts inspite of all the necessary ingredients being present during breakouts.
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Hitesh sir, what are your views on Usha Martin results. Results are more or less flattish qoq, what are the growth triggers for them in near future?
Also, sometime back you mention flag pattern in SSWL, does technicals work in ASM stocks? Considering volumes become very less.
Thanks much in advance!!!
Hi Hitesh,
Please share your views on Gufic Biosciences. FII holding has increased from 0.14% to 1.52% in the last quarter. Company seem to have declared positive quarterly results. On the weekly chart it seem to be forming a flag pattern.
Thanks in advance for your views!!
Usha martin results have been on expected lines. Traditionally, q2 is a weak quarter because infrastructure activities are subdued due to monsoon. But company seems to have done reasonably well. It seems to have managed raw material price hikes also well. Valuationwise its not very expensive considering its a steel converter.
Volume shrinkage due to whatever reason is a feature in flag formation. In case of SSWL it might be ASM, or a lack of broad based market strength. I think real momentum will be seen once stock price crosses and stays above 1900.
@akshay1970 I dont track gufic bio.
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Sir Any inputs on Mirza International
Hello Sir
Sir do u track RHI magnesita India and Grindwell Norton …? Your take on both…