Friends markets have been under relentless pressure since last many weeks and investor’s wealth have been getting eroded significantly. Current fall is caused by mostly NBFCs, Housing Finance companies and some IT companies as well. Let’s see what we can expect in the coming week from mid-caps.
ASM Impact:
The big news for Mid-Caps is the BSE-NSE announcing the exclusion of 111 companies from the ASM list from Tuesday 30th Oct. Remember most of the companies have fallen significantly since their inclusion in this ASM list. And most of these companies have been in this list for a very long time. Many of them were on the list for 5 months or more.
Because of stocks in ASM list, most of them have seen trading volume disappearing and traders interest in such shares were gone. These shares were not allowed to trade with margin, and the circuit was fixed at 5%. But now the margin trading will be allowed from Tuesday 30th Oct onwards. Circuit filter change has not been announced yet, so most probably all of them might remain in 5% circuit range for a couple of weeks.
So what might be the impact of this announcement? I am not an expert, but based on previous such instances Fineotex Chemicals, Venky’s and many more, we can expect fireworks in these shares on Monday and maybe for the entire week.
If global market is not extremely weak, these 111 mid-cap shares will lead the mid-cap index and pull along many other mid-caps to positive closing. Since they will be out of ASM only from Tuesday, they will have to buy with full margin on Monday. So many traders will try to garner as many shares on the opening itself. Most of the fundamentally strong companies might go in upper circuit quickly.
In my opinion, few stocks look good for more than 20-20% gain in this week from Friday’s closing prices.
Rain Industries: Pet Coke ban issue is now past. The stock has gone into 5% circuit on Friday. But couldn’t hold it till close. Looks set for crossing 200 again this week.
Radico Khaitan: With very strong results in Q1 and Q2, the stock looks set for a solid run this week. It is one of the few companies with consumption as a theme and good brand value for its products. It does not get impacted by rising crude or falling rupee. And in elections around the corner, things can get only better.
Associated Alcohol: This is out of ASM long back. But because of a rally in mid-caps is expected, it might also follow the uptrend and quickly cross the 300 marks again this week and has the potential to cross 325 also in coming days. Remember during elections in Madhya Pradesh, alcohol consumption will increase and this company has most of the revenues coming from this state only.
VIP Industries: Also from consumption basket, has already run up a lot despite being in ASM. This was one of the very few shares which have created new 52 weeks high after being added in ASM list. But after that has seen a good correction. Still, traders might find this as an opportunity to push it towards new highs. But be careful, the stock price is not cheap. If trading in it. Keep booking profits.
Graphite India: It has also seen many ups and downs while in ASM for the last 5 months. The only hangover now is court case running for its Bengaluru plant. Supreme court will be hearing the case again on Monday 29th Oct. SC will determine the penalty to be imposed on the company as well. But more or less company should be ok after paying the fine. It should also perform well in this week unless any severe or unexpected punishment comes from the Supreme Court.
There are many traders favourite’s which can also show good strength because of this ASM news. Few of them, in my opinion, can give good returns on a trading point of view are: Apex Frozen Foods, Action Construction Equipment, Butterfly Gandhimathi Appliances, Den Networks, Emami Infrastructure, Globus Spirits, GM Breweries, Gujarat Ambuja Exports, Hindustan Foods, India Glycols, IOL Chemicals, V-mart retail and Weizman Ltd.
I would avoid few shares from this 111 companies. Few of them are Bombay Dying, Indiabulls Venture, Reliance Naval, Mirc Electronics, Jaypee Infratech and Alok industries.
There are many companies in this list of 111 where the company’s promoter’s management quality is not up to mark and we need to be extra careful in investing any of them.
Before you invest, anytime, keep the following points in mind:
1. Never go overboard while buying or selling. Don’t buy with borrowed money. Never ever hold only one or two companies’ shares. We should keep our portfolio diversified across at least 10 companies from different sectors. It will help in minimizing the losses from one sector/company.
2. Keep booking profits whenever there is 10-20-30% returns. The market is and will remain volatile for time to come and we should not be too greedy for many fold returns in one go.
List of securities moving out of ASM Framework w.e.f. October 30, 2018:
| Sr. No. | Scrip Code | ISIN | Name of the Company |
| 1 | 532762 | INE731H01025 | Action Construction Equipment Ltd |
| 2 | 541450 | INE364U01010 | Adani Green Energy Ltd |
| 3 | 539254 | INE931S01010 | Adani Transmission Ltd |
| 4 | 521070 | INE270A01011 | Alok Industries Ltd |
| 5 | 520077 | INE130C01021 | Amtek Auto Ltd |
| 6 | 540692 | INE346W01013 | Apex Frozen Foods Ltd |
| 7 | 530565 | INE149B01015 | Archana Software Ltd |
| 8 | 516064 | INE570D01018 | Arrow Greentech Ltd |
| 9 | 540024 | INE361S01010 | Ashari Agencies Ltd |
| 10 | 590021 | INE838B01013 | Bharat Rasayan Ltd |
| 11 | 533321 | INE607L01029 | Bil Energy Systems Ltd |
| 12 | 500060 | INE800A01015 | Birla Cable Ltd |
| 13 | 500020 | INE032A01023 | Bombay Dyeing & Manufacturing Company Ltd |
| 14 | 532678 | INE589G01011 | Bombay Rayon Fashions Ltd |
| 15 | 540006 | INE595R01015 | Bullish Bonds & Holdings Ltd |
| 16 | 517421 | INE295F01017 | Butterfly Gandhimathi Appliances Ltd |
| 17 | 531595 | INE180C01026 | Capri Global Capital Ltd |
| 18 | 511742 | INE583D01011 | Chokhani Securities Ltd |
| 19 | 534758 | INE675C01017 | Cigniti Technologies Ltd |
| 20 | 533137 | INE947J01015 | Den Networks Ltd |
| 21 | 500119 | INE041A01016 | Dhampur Sugar Mills Ltd |
| 22 | 506405 | INE505A01010 | Dharamsi Morarji Chemical Company Ltd |
| 23 | 533218 | INE778K01012 | Emami Infrastructure Ltd |
| 24 | 504008 | INE078A01026 | Emco Ltd |
| 25 | 533090 | INE688J01015 | Excel Realty N Infra Ltd |
| 26 | 502865 | INE518A01013 | Forbes & Company Ltd |
| 27 | 539730 | INE194R01017 | Fredun Pharmaceuticals Ltd |
| 28 | 539228 | INE480S01026 | Gala Global Products Ltd |
| 29 | 533265 | INE528K01029 | Gallantt Ispat Ltd |
| 30 | 532959 | INE181G01025 | Gammon Infrastructure Projects Ltd |
| 31 | 500655 | INE291A01017 | Garware Polyester Ltd |
| 32 | 539407 | INE854S01022 | Generic Engineering Construction and Projects Ltd |
| 33 | 533104 | INE615I01010 | Globus Spirits Ltd |
| 34 | 507488 | INE075D01018 | GM Breweries Ltd |
| 35 | 509488 | INE371A01025 | Graphite India Ltd |
| 36 | 532775 | INE221H01019 | GTL Infrastructure Ltd |
| 37 | 524226 | INE036B01022 | Gujarat Ambuja Exports Ltd |
| 38 | 532708 | INE251H01024 | GVK Power & Infrastructure Ltd |
| 39 | 533162 | INE982F01036 | Hathway Cable & Datacom Ltd |
| 40 | 519126 | INE254N01018 | Hindustan Foods Ltd |
| 41 | 500201 | INE560A01015 | India Glycols Ltd |
| 42 | 532960 | INE274G01010 | Indiabulls Ventures Ltd |
| 43 | 524164 | INE485C01011 | IOL Chemicals & Pharmaceuticals Ltd |
| 44 | 530773 | INE875A01025 | IVRCL Ltd |
| 45 | 538539 | INE075K01013 | J. Taparia Projects Ltd |
| 46 | 533207 | INE099J01015 | Jaypee Infratech Ltd |
| 47 | 514034 | INE187A01017 | JBF Industries Ltd |
| 48 | 531543 | INE247D01021 | Jindal Worldwide Ltd |
| 49 | 532054 | INE291D01011 | KDDL Ltd |
| 50 | 532967 | INE415I01015 | Kiri Industries Ltd |
| 51 | 530149 | INE219A01026 | KSL & Industries Ltd |
| 52 | 532081 | INE216D01026 | KSS Ltd |
| 53 | 506079 | INE651C01018 | Lakshmi Precision Screws Ltd |
| 54 | 532778 | INE785C01048 | Lanco Infratech Ltd |
| 55 | 539207 | INE122R01018 | Manpasand Beverages Ltd |
| 56 | 540023 | INE621I01018 | Millitoons Entertainment Ltd |
| 57 | 500279 | INE831A01028 | Mirc Electronics Ltd |
| 58 | 531453 | INE954E01012 | Mohit Industries Ltd |
| 59 | 500288 | INE083A01026 | Morepen Laboratories Ltd |
| 60 | 523160 | INE599F01012 | Morganite Crucible India Ltd |
| 61 | 532376 | INE398B01018 | MRO-TEK Realty Ltd |
| 62 | 532895 | INE245I01016 | Nagreeka Capital & Infrastructure Ltd |
| 63 | 507813 | INE296D01010 | National Oxygen Ltd |
| 64 | 513179 | INE088B01015 | National Steel and Agro Industries Ltd |
| 65 | 532439 | INE260D01016 | Olectra Greentech Ltd |
| 66 | 533317 | INE474L01016 | Omkar Speciality Chemicals Ltd |
| 67 | 530381 | INE742A01019 | Petron Engineering Construction Ltd |
| 68 | 511116 | INE527B01020 | Quadrant Televentures Ltd |
| 69 | 532497 | INE944F01028 | Radico Khaitan Ltd |
| 70 | 500339 | INE855B01025 | Rain Industries Ltd |
| 71 | 523289 | INE763B01013 | Rama Vision Ltd |
| 72 | 514223 | INE410D01017 | Ramgopal Polytex Ltd |
| 73 | 533262 | INE874I01013 | Ramky Infrastructure Ltd |
| 74 | 533107 | INE542F01012 | Reliance Naval and Engineering Ltd |
| 75 | 505509 | INE688D01026 | Responsive Industries Ltd |
| 76 | 539875 | INE616F01014 | RSD Finance Ltd |
| 77 | 531307 | INE951M01037 | S R K Industries Ltd |
| 78 | 523025 | INE429E01023 | Safari Industries India Ltd |
| 79 | 538557 | INE706P01020 | Sai Baba Investment And Commercial Enterprises Ltd |
| 80 | 526807 | INE497B01018 | Seamec Ltd |
| 81 | 533389 | INE510K01019 | Shilpi Cable Technologies Ltd |
| 82 | 541540 | INE624Z01016 | Solara Active Pharma Sciences Ltd |
| 83 | 532651 | INE978G01016 | SPL Industries Ltd |
| 84 | 530943 | INE416A01036 | Sri Adhikari Brothers Television Network Ltd |
| 85 | 539363 | INE094T01015 | Sri Krishna Constructions (India) Ltd |
| 86 | 536799 | INE002J01027 | SRS Finance Ltd |
| 87 | 533569 | INE219H01039 | SRS Ltd |
| 88 | 533305 | INE953I01023 | SRS Real Infrastructure Ltd |
| 89 | 570005 | INE224E01036 | Stampede Capital Ltd - DVR |
| 90 | 512299 | INE324C01038 | Sterling Biotech Ltd |
| 91 | 508969 | INE673M01029 | Sulabh Engineers & Services Ltd |
| 92 | 532711 | INE305H01028 | Sunil Hitech Engineers Ltd |
| 93 | 521180 | INE662A01027 | Super Spinning Mills Ltd |
| 94 | 530677 | INE822E01011 | Supreme Holdings & Hospitality (India) Ltd |
| 95 | 532904 | INE550H01011 | Supreme Infrastructure India Ltd |
| 96 | 539353 | INE724G01014 | Swaraj Automotives Ltd |
| 97 | 533164 | INE141K01013 | Texmo Pipes and Products Ltd |
| 98 | 540980 | INE868X01014 | The Yamuna Syndicate Ltd |
| 99 | 500414 | INE064A01026 | Timex Group India Ltd |
| 100 | 532812 | INE804H01012 | Transwarranty Finance Ltd |
| 101 | 540083 | INE871L01013 | TV Vision Ltd |
| 102 | 532513 | INE236G01019 | TVS Electronics Ltd |
| 103 | 526957 | INE493E01029 | Uniply Decor Ltd |
| 104 | 500254 | INE292A01023 | Uttam Value Steels Ltd |
| 105 | 517015 | INE707A01012 | Vindhya Telelinks Ltd |
| 106 | 507880 | INE054A01027 | VIP Industries Ltd |
| 107 | 534976 | INE665J01013 | V-Mart Retail Ltd |
| 108 | 523011 | INE080A01014 | Weizmann Ltd |
| 109 | 522108 | INE384C01016 | Yuken India Ltd |
| 110 | 533339 | INE251B01027 | ZEN Technologies Ltd |
| 111 | 512553 | INE058B01018 |
Zenith Exports Ltd |
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