Given the fact that tomorrow is expiry and now Nifty is comfortably above the 22,000 level, how do you expect Nifty to close on expiry and what is your expectation for April?
Nooresh Merani: For expiry, the bias is positive. We could see more momentum if the Bank Nifty sustains above 47,000 and 22,200 for the Nifty. If that happens, we get into a further move and generally on the last day of the month as well as the last day of the year we could see a lot of moves in the last 30 minutes. So it is tough to take the expiry call tomorrow, but the bias is positive. Overall, the broader markets have done better over the last two-three sessions and that makes the bias all the more positive.

What is your take on the big boy that is Reliance Industries? The stock is up around 4% odd today. On a year-to-date basis, it has gained nearly 16 odd percent. Do you expect the stock to consolidate around these levels now or do you see more upside?
Nooresh Merani: Technically, the last breakout happened above the Rs 2750-2800 level which was a big uptick day. On the retest, we did not go to those levels reverse from Rs 2,820-2,825 levels and now we are closer to all-time highs and add to it Jio Finance, the overall the move has been good over the last three-six months but a fresh all-time high above Rs 3,000-3,040 give it impetus towards 3,300 in the short term. It remains a buy on dips going forward. On any dips back to Rs 2900 odd levels, 2930, it would be a buy. The target price on the upside should be Rs 3,300 going forward.

Among the major sectoral indices, Nifty FMCG has continued to remain weak. It is one of the top losers on a YTD basis and also on a month-to-date basis, the index is down. How do you see FMCG as a pack right now?
Nooresh Merani: FMCG as a pack looks to be in a consolidation which could last much longer. But there are divergences. There is Hindustan Unilever where the last four-year return is zero and then Tata Consumer which has been making new all-time highs for the last four months. Similarly, Godrej Consumer has been an outperformer. But Emami or Dabur or Marico have been underperformers by a big margin. So, the struggle is there.

We have seen before that as a sector, when FMCG goes sideways, it can stay long in that range. We have had a 10-year period where Hindustan Unilever did nothing between 2002 and 2012 and now it has already been four years, the stock is almost at the same prices where it was around the Covid highs. So, the view is one has to be very selective and one could be better off avoiding the underperformers as of now.

Look at the outperformers on dips. Apart from that, Britannia is the one which looks interesting if it can sustain above Rs 5,000, 5,100. There is also Colgate which has hit new all-time highs. So, there is a divergence. The old names, which were earlier the best movers, have gone sideways. The new leaders have already been created.When it comes to the broader market, the Nifty Mid Cap and Small Cap have continued to gain, it is the second consecutive days of gains that we have been seeing for both the indices. What is your outlook here? Do you expect them to retest the lower levels that we had seen recently a few days back?
Nooresh Merani: The view on the midcap and the smallcap indices is that we had this huge rally from the March bottom of last year. We finally got a correction in March. We generally tend to get some selling in March, which get absorbed really fast. We did not see a larger correction and we have recovered well. But what changes after a 10-15% correction is that everything going up stance is no more there. In 2023, one could have bought anything and 80-90% of the stocks did well and they outperformed the benchmark indices. Now one has to be very selective. There could be a time where a lot of these older movers of the outperformers of the last one year, whether it is defence, railways, and many such names could go sideways for the next three-six months going forward on a minimum timescale. So, try to focus on newer outperformers, wherein stocks which start making new 52-week high now would be more interesting. So, the view is one has to be very selective now.

What are your top picks for today?
Nooresh Merani: So, first is a buy on Indian Hotels, a clear trending stock has made a short-term range breakout, showing good momentum, a target price of 620, stop loss at 570. Second is a buy on Hindalco which has made a strong base and now crossed the last two-month highs, as well as the gap down has been pierced. So, expecting it to cover the whole gap. Target price would be 600-620 in the short-term, stop loss at 550.