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Informist, Thursday, Sep 26, 2024

By Anjana Therese Antony

MUMBAI – After Citi Research initiated coverage on Trent with a 'buy' rating and a target price of 9,250 rupees, traders added long bets to the derivatives chain of the stock today. Citi's target price for Trent is around 1,400 rupees higher than the stock's closing price of 7,845.40 rupees today on the National Stock Exchange, a gain of 3% from the previous close. Premiums on out-of-the-money call options of Trent rose over 40%, those on puts declined around 30%. 

The company has outpaced its industry peers and drove Street upgrades despite weak consumer sentiment, a slowdown in discretionary spending, and downgrades for most other consumer stocks, the foreign broking firm reportedly said. It also added Trent to its pan-Asia high-conviction focus list, an NDTV report, attributing Citi, said. Trent's famous 'Zudio' and brands in different formats have the potential to ramp up in the medium term and drive further growth, it said. Trent will also become a part of the Nifty 50 index from October and Nuvama Institutional Equities expects an inflow of $702 mln.  

In the options chain of the stock, premiums on 7,800-8,400 rupees of call options expiring Oct 31 rose 42-68%, while those on 7,800-6,000 rupees strikes of puts declined 28-44%. The maximum open interest addition is at 8,000-rupee call and 7,800-rupee put options. 

The overall equity market is likely to see muted gains Friday, especially as valuations remain stretched and in the absence of major triggers, analysts said. They also expect some corrections in the coming sessions as the domestic market hit new record highs throughout this week. 

Today, the Nifty 50 and BSE Sensex closed 0.8% higher each at their all-time closing highs of 26216.05 points and 85836.12 points, respectively. The support for the 50-stock index is pegged at 26100-26000 points for the near term and resistance at 26300-26350 points, technical and derivatives analysts at three broking firms said.

Premiums on Nifty 50 26200-27000 call options expiring next week rose 32-57% and those on 26000-25000 put contracts declined 17-47%. The highest addition of open interest was at 27500-point call and 25000-point put options. 

--Nifty 50 Oct closed at 26285.25, up 158.55 points; 69.20-point premium to spot index

--Nifty 50 Nov closed at 26380.00, up 148.00 points; 163.95-point premium to spot index

Reliance Industries, Tata Motors, HDFC Bank, ICICI Bank, State Bank of India, Vedanta, Infosys, Maruti Suzuki India, ITC, Tata Consultancy Services, Adani Enterprises, Bajaj Finance, Hindustan Aeronautics, Tata Steel, Larsen & Toubro, and Mahindra & Mahindra were the most-actively traded contracts.  End

Edited by Deepshikha Bhardwaj

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