Buy IndusInd Bank in the range of Rs. 520-530 - Quant Pick - ICICI Securities

Recommendation

Buy IndusInd Bank in the range of Rs. 520-530
Target: Rs. 620
Stop Loss: Rs. 476
Time frame: Three months

Derivatives & Quantitative Outlook

The banking space has underperformed in the recent up move of the market. Most of the stocks remained largely range bound in the last three months. However, heavily beaten down stocks from the sector have shown relative outperformance in the recent leg. Stocks like IndusInd Bank have seen significant addition in open interest while finding support near their major Put base. We believe further momentum due to short covering cannot be ruled out.

Unlike most stocks, open interest in IndusInd Bank remained high as it has stayed under pressure since 2018. The sell-off in March has been quite sharp as the stock moved to sub Rs. 300 levels from highs of Rs. 1600 seen in January 2020. A significant sell-off in the stock has invited continued short build-up. Despite the recent recovery, OI remained high and is at life-time highs. We expect a round of short covering to be seen in the stock that should take it further higher.

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_QuantPick_IndusInd_Aug20.pdf

Shares of INDUSIND BANK LTD. was last trading in BSE at Rs.568.1 as compared to the previous close of Rs. 536.3. The total number of shares traded during the day was 1021668 in over 16480 trades.

The stock hit an intraday high of Rs. 572 and intraday low of 539. The net turnover during the day was Rs. 568415090.

Source : Equity Bulls

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