F&O: Higher F&O rollovers put these stocks on traders’ radar

Futures of various stocks have seen a build-up in the October series with traders rolling over their bets from the September contracts, which expired on Thursday. A look at stock futures that have seen higher-than-average rollovers and their near-term outlook.

Titan Company

CMP: Rs 3,817
Rollover to October series: 97.5%
Futures open interest change in October series: 7%
Share performance last week: 0.5%

Traders are betting on Titan as higher gold prices and expectations of a pick-up in demand due to the festive season are seen driving profitability. “The stock has been making higher top – higher bottom for the last six trading sessions,” said Chandan Taparia, head of technical and derivatives research at Motilal Oswal Financial Services. Taparia said the stock is now hovering near a key hurdle of Rs 3,850 zones and a small follow up above Rs 3,850 could take it into new lifetime high territory of Rs 4,000-4,250 zones.

Indian Oil Corp
CMP: Rs 180
Rollover to October series: 94%
Futures open interest change in October series: 1%
Share performance last week: 7.8%

Analysts expect margins of oil marketing companies to improve with crude prices softening. Traders could buy the stock for a price target of Rs 196 with a stop loss of Rs 171, said Ruchit Jain, lead research analyst at 5Paisa.com.
“IOC has formed a support around its 100- day EMA (exponential moving average) and the RSI (Relative Strength Indicator) is hinting at a positive momentum along with bullish price volume action,” said Jain.

Colgate-Palmolive (India)
CMP: Rs 3,764
Rollover to October series: 86%
Futures open interest change in October series: 28%
Share performance last week: 2.8%

Taparia of Motilal Oswal says the stock has seen a consolidation breakout on daily scale with a decisive hold above Rs 3,700 zones. “There has been a surge in trading and delivery volumes along with fresh long build up,” he said. Taparia has set a price target of Rs 3,950 and recommends holding with a stop loss of Rs 3,600.

ICICI Pru Life
CMP: Rs 789
Rollover to October series: 80.6%
Futures open interest change in October series: Flat
Share performance last week: 2.8%

The stock has seen a breakout to life-time highs, which shows strong underlying momentum, said Sriram Velayudhan, senior vice president at IIFL Securities. “While the futures open interest structure has been flat, price action has been moving higher — pointing towards long build-up.” Velayudhan has a price target of Rs 845 and advises holding with a stop loss of Rs 770

Sun Pharma
CMP: Rs 1,948
Rollover to October series: 77%
Futures open interest change in October series: 2%
Share performance last week: 4.5%

Sun shares hit lifetime highs on Friday after a ‘Buy’ rating from brokerage UBS. Traders could buy the stock with a price target of Rs 2,100, keeping a stop loss of Rs 1,860, said Jain of 5Paisa.com. “The stock has seen a gradual up-move in the last few weeks and the RSI oscillator hints at a continuation of the positive momentum,” he said. “The volumes are good along with the price up-move and hence, we expect the uptrend to continue at its all-time highs.”

IEX
CMP: Rs 206
Rollover to October series: 87%
Futures open interest change in October series: 20%
Share performance last week: -10.9%

Indian Energy Exchange fell last week on reports of implementation of market coupling, which aims to establish a unified price for electricity across different trading platforms. This could impact the competitive edge of the largest player in this space. Analysts see more weakness in the stock. “It added a significant open interest of 20% with sell on bounce stance in stock indicating shorts are intact with weak price structure for short term,” said Taparia, who has set a price target of Rs 190. The stop loss for the trade is Rs 215.