Dabur India – BUY
CMP Rs102, Target Rs115
December 16, 2010
After a long consolidation, Dabur India has broken out from a falling
channel. This has brought to an end the short-term downtrend in the
FMCG counter. The price has sustained above the falling channel and
has formed a convex structure on the daily chart, indicating a steady
accumulation in the counter. A move past Rs100 should provide a
Target 1 (Rs):
decent upside opportunity of 10-15% in the near term.
Target 2 (Rs):
Stop Loss (Rs):
The neck line of inverted head and shoulder corresponds at Rs99,
which should act as a solid base for building up of momentum. The
52 Week h/l (Rs):
112 / 73
stock has also managed to trade above the short-term and the
medium-term moving averages, which initially acted as stiff
Market cap (Rscr) :
resistance. Hence, the stage is set for the stock to rally to Rs115 in
6m Avg vol (‘000Nos):
the near term.
No of o/s shares (mn):
Being a defensive counter, the Dabur India has held well above the
long-term support levels despite volatility in the broader markets.
On the weekly chart, the RSI has given a positive crossover after a
long time. This also provides better risk reward ratio from the
Prices as on 15 Dec, 2010
Non promoter corp hold
Public & others
Performance rel. to sensex
Share price trend
Source: India Infoline Research, Metastock
Dabur India has seen good delivery based buying of around 3mn
shares in the last three trading sessions, with an average delivery of
around 60%. The stock has experienced good long build-up in
current month futures of around 74,000 in total open interest of
3.8mn. This long build-up was preceded by some short covering. The
stock has been maintaining an average volatility of around 36%
despite of some shorts seen a fortnight before. Dabur India is also
trading with low VAR (Value at Risk) of around 8.84%. The outlook
on the stock appears to be positive from the current level of Rs100
for a target of Rs115 in the short term.
Recommendation parameters for fundamental reports:
Buy – Absolute return of over +10%
Market Performer – Absolute return between -10% to +10%
Sell – Absolute return below -10%
Published in 2010. © India Infoline Ltd 2010
This report is for the personal information of the authorised recipient and is not for public distribution and should not be reproduced or redistributed
without prior permission.
The information provided in the document is from publicly available data and other sources, which we believe, are reliable. Efforts are made to try
and ensure accuracy of data however, India Infoline and/or any of its affiliates and/or employees shall not be liable for loss or damage that may
arise from use of this document. India Infoline and/or any of its affiliates and/or employees may or may not hold positions in any of the securities
mentioned in the document.
The report also includes analysis and views expressed by our research team. The report is purely for information purposes and does not construe to
be investment recommendation/advice or an offer or solicitation of an offer to buy/sell any securities. The opinions expressed are our current
opinions as of the date appearing in the material and may be subject to change from time to time without notice.
Investors should not solely rely on the information contained in this document and must make investment decisions based on their own investment
objectives, risk profile and financial position. The recipients of this material should take their own professional advice before acting on this
India Infoline and/or its affiliate companies may deal in the securities mentioned herein as a broker or for any other transaction as a Market Maker,
Investment Advisor, etc. to the issuer company or its connected persons.
This report is published by IIFL ‘India Private Clients’ research desk. IIFL has other business units with independent research teams separated by
'Chinese walls' catering to different sets of customers having varying objectives, risk profiles, investment horizon, etc and therefore, may at times
have, different and contrary views on stocks, sectors and markets.
IIFL, IIFL Centre, Kamala City, Senapati Bapat Marg, Lower Parel (W), Mumbai 400 013.
For Research related queries, write to: Amar Ambani, Head of Research at [email protected] or [email protected]
For Sales and Account related information, write to customer care: [email protected] or call on 91-44 4007 1000