4 Stock Recommendations for May 28 to June 01, 2018

1) RBL Bank Limited - BUY

Stock Pick		Observation
Company	RBL Bank Limited	The stock has witnessed a breakout from a declining triangle formation on the daily chart backed by a smart uptick in volumes. It has also formed a bullish engulfing candlestick pattern on the daily chart. We expect the positive momentum to continue in the stock in the following week and recommend a Buy.
Recommendation
Buy or Sell	Buy (Cash)
Range (Rs)	512-517
Target (Rs)	552
Stop Loss (Rs)	492
Duration	1 week
200 D-EMA	499
NSE Code	RBLBANK

2) Kotak Mahindra Bank Limited - BUY

Stock Pick		Observation
Company	Kotak Mahindra Bank Limited	The stock is trading in a higher-top-higher-bottom chart structure and has taken support along the rising trend line on the daily chart. The stock has also witnessed positive momentum on the daily MACD Histogram. Derivative data indicates short covering in the stock.
Recommendation
Buy or Sell	Buy (Cash)
Range (Rs)	1,288-1,298
Target (Rs)	1,370
Stop Loss (Rs)	1,240
Duration	1 week
200 D-EMA	1071
NSE Code	KOTAKBANK

3) Tata Sponge Iron Limited - BUY

Stock Pick		Observation
Company	Tata Sponge Iron Limited	The stock has witnessed a bullish crossover on the daily MACD histogram backed by an uptick in volumes. The stock has also formed a bullish hammer candlestick pattern on the weekly chart. We expect the positive momentum to continue and recommend a buy with a target of 1,170
Recommendation
Buy or Sell	Buy (Cash)
Range (Rs)	1,089-1,098
Target (Rs)	1,170
Stop Loss (Rs)	1,046
Duration	1 week
200 D-EMA	980
NSE Code	TATASPONGE

4. Stock Name - UPL Ltd - BUY      

    
CMP: 697, Upside:  24%, Period: 1 Year
 

UPL is a leading global generic agrochemicals player engaged in the production of crop protection products, intermediates, specialty chemicals and other industrial chemicals. Its geographical revenue mix in FY18 consisted of Latin America (~33%), India (~18%), North America (~18%) and Europe (~13%). Rest of the world contributed ~18% to its revenue in FY18. UPL’s export opportunities are increasing owing to low cost manufacturing base providing diversified geographical reach across key markets in the world. UPL plans to launch new products in fungicide and herbicide segments in India, which are expected to grow by 15% over next 5 years supported by good monsoon. Rising input costs may drive agrochemical prices higher if demand recovers enabling margin improvement through backward integration. Overall, we see revenue CAGR of ~13% over FY18-20E. We expect expansion in EBITDA margin by ~50bps over FY18-20E (20.7% in FY20E). Further, we expect the company to reduce D/E ratio to ~0.3x in FY20E (~0.9x in FY17). Consequently, we estimate PAT CAGR of ~20% over FY18-20E.  We recommend BUY on the stock with target valuation at 15x FY20E EPS.