Buy Axis Bank in range of Rs. 700-717
Target: Rs. 840
Stop Loss: Rs. 635
Time frame: Three months
Derivatives & Quantitative Outlook
The banking space has underperformed in the ongoing volatility. Most stocks remained largely range bound in the last couple of weeks. However, heavily beaten down stocks from the PSU space have shown relative outperformance in the recent leg. In the private sector space, Axis Bank has seen a significant reduction in open interest while finding support near its major Put base. We expect continued momentum from the support zone.
Unlike most stocks, open interest in Axis Bank is at a two-year low. The sell-off in March 2020 has been quite sharp as the stock moved to sub Rs. 300 levels from highs of Rs. 700 seen in January 2020. A significant sell-off in the stock had invited continued short build-up. However, in the past leg of the recovery, open interest declined significantly due to short covering. Currently, considering prevailing low leverage, there is ample room for increase in open interest. We expect long positions to be formed in the stock as it is trading near major support levels of Rs. 680-700.
For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_QuantPick_AxisBank_May21.pdf
Shares of AXIS BANK LTD. was last trading in BSE at Rs.715.85 as compared to the previous close of Rs. 717.15. The total number of shares traded during the day was 288307 in over 6418 trades.
The stock hit an intraday high of Rs. 722.45 and intraday low of 710.5. The net turnover during the day was Rs. 206214895.