Based on our research best stocks for swing trading this week are Asian Paints Ltd. and Bata India Ltd.
| Asian Paints Ltd. | Bata India Ltd. |
| Asian Paints Ltd can rise up to 25% approx from the current price in the upcoming days. | Bata India Ltd can show an upside movement of 26% approx from the current price in the upcoming days. |
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Below are the important highlights regarding both stocks:
Asian Paint’s profits are growing regularly which is why it is simple to understand that the stock price will eventually follow the growth of the company.
Bata India’s Sales are neutral. Its net profits are down because of the same reason as Relaxo Footwears Ltd. As we discussed in the previous blog of this series the raw material costs of these companies have gone high because of the inflation that’s why these companies are under pressure.
| Asian Paints Ltd. | Bata India Ltd. |
| Asian Paints Ltd. has recently posted the highest-ever quarterly results with Net Sales increased by 5.4% to ₹ 9,074.9 crores and Net profit increased by 35% to 1475 Cr. | Bata India Ltd quarterly results have been neutral with a minimal Revenue growth of 0.4% to 903 Cr. and a drop of net profit by 30%. |
Note – The information is for education purposes only. We are not a SEBI-registered advisory. Please consult your financial advisor before trading or investing money in the stock market.
Asian Paints Ltd.:-
The biggest retailer of interior décor in India is called Asian Paints. Under its corporate umbrella are well-known brands such as Asian Paints, Berger, and Apco, and more than eighty years of experience. The company sells wall paints, wall coverings, adhesives, waterproofing, wall stickers, mechanized tools, modular kitchens, sanitaryware, lighting, soft furnishings, and uPVC windows.
KEY POINTS –
1. Brand
Some of the top brands, including Asian Paints, Sleek, Berger, Weather Seal, Apco, Taubman, Kadisco, Scib, and others, are owned by the Asian Paints company. Ten of the twenty-five patents submitted in FY23 were granted.
2. Revenue Breakup FY23
Decorative Business – 84%
Home Decor Business – 4%
Industrial Coatings – 3%
International Operations – 9%
3. Leadership
Over 50 Years of Leading the Indian Market, renowned producer of wallpaper under the NILAYA brand.
three times the closest Indian competitor.
4. Business Segments
- Decorative Business
Leading paint and décor firm in India, Asian Paints offers the world’s largest painting service, available in more than 600 locations. This covers waterproofing, wood finishes, undercoats, enamels, adhesives, tools, and exterior and interior wall finishes.
- Home Decor Business
In this category, the business attempts to offer clients a full-service, one-stop shop for home décor. This covers wall coverings, furniture, soft furnishings, lighting, uPVC windows, modular kitchens, and sanitaryware.
- Industrial Business
In this market, the company supplies premium, specially blended products to India’s industrial and automotive coatings industries. This covers road markings, powder coatings, floor coatings, automotive, marine, and packaging coatings, and industrial protective coatings.
- Sales & Distribution
In India, the company has more than 150,000 retail touchpoints. Beautiful Home has forty-two stores. It provides services to more than 60 nations.[1]The organization has a supplier base of more than 20,000 and 240,000 business influencers.
- Manufacturing Facilities
The company operates 17 production plants outside of India in addition to 11 in India. The company’s Ankleshwar factory, the first in the world for the coatings sector, has achieved the BBS Generative Stage. There are 27 outsourced processing centres owned by the corporation.
Fundamentals of Asian Paints Ltd: –
( For a better understanding of fundamentals you can visit screener.in )
| Asian Paints Ltd. Fundamentals |
|---|
| Market Cap – ₹ 2,73,352 Cr. |
| Stock P/E – 50.1 |
| Current Price – ₹ 2,850 |
| High / Low – ₹ 3,568 / 2,706 |
| Book Value – ₹ 173 |
| Debt to Equity –0.14 |
| Return on Equity – 10 Years – 27% |
| Return on Capital Employed – 10 years – 36.6 % |
| Compounded Profit Growth – 10 years –14% |
| Stock Price CAGR – 10 years – 20% which is very good. |
| Institutions Shareholding Holding – 28% which is very good.. |
Technical Analysis of Asian Paints Ltd: –
As you can see from the chart below, The Stock has been trading in a range for quite some time now.
( For a better understanding of charts you can visit tradingview.com )
The company is posting good profits as per the scenario The stock is trading in a range from May 2021 which is approx 2 and half years. And it’s trading at the lowest support range. And it will definitely go towards its upside range in the upcoming days. That’s why this stock is the best fit to buy as per our tried and tested Range Bound Strategy. It can show an upside move of 25% to the target of 3570 approx. soon. This is why we firmly believe that Asian paints are the best stocks for swing trading this week.
Note – The information is for education purposes only. We are not a SEBI-registered advisory. Please consult your financial advisor before trading or investing money in the stock market.
Bata India Ltd:-
The main line of business for Bata India is the production and distribution of accessories and footwear via its network of retail and wholesale locations.
KEY POINTS –
1. The World’s leading Footwear company
In 1894 the establishment of Bata Corporation in the Czech Republic. With production facilities spread throughout 18 countries and a retail presence of over 5,300 stores across more than 70 countries, the company leads the shoe industry globally in terms of volume. It began operations in India in 1931 and went public in 1973. Currently, 53% of the company is owned by the Bata Corporation.
2. Manufacturing Facilities
The company’s four manufacturing facilities are located in Hosur (Tamil Nadu), Peenya (near Bangalore), Bataganj (Bihar), and Batanagar (Kolkata). The business can manufacture 21 million pairs of shoes annually.
3. PAN India Presence
Including franchisee stores, there are 1,569 locations throughout India’s cities, totalling 3.07 million square feet of retail space.
4. Multi-Brand Portfolio
In India, Bata offers footwear under many prestigious brands that serve both the lower and upper echelons of the demand pyramid. The brands that are part of the brand are Mocassino, Ambassador, Bata Comfit, Power, Marie Claire, North Star, Naturaiser, Scholl, and Hush Puppies.
5. Retail Business
With a stronger emphasis on tier 3 – 4 cities, Bata’s goal is to increase the size of its retail footprint. The company opened 75 franchisee locations in FY22, bringing the total number of franchise locations in the nation to over 300. Furthermore, the company negotiated rents across more than 1000 locations, saving crores of dollars.
6. Bata Club
Currently, approximately 13 million people are active members of Bata’s primary loyalty program, Bata Club. Any customer who buys a product from Bata can become a member. The company has implemented several initiatives, such as customized campaigns and discounts, which have increased the average monthly repeat rate by 5% percentage points. Additionally, the rate of walk-ins during campaigns has doubled among Bata Club Members compared to the previous year.
Fundamentals Of Bata India Ltd:-
( For a better understanding of fundamentals you can visit screener.in )
| Bata India Ltd. |
|---|
| Market Cap – ₹ 18,449 Cr. |
| Stock P/E – 63.8 |
| Current Price – ₹ 1,435 |
| High / Low – ₹ 1,771 / 1,381 |
| Book Value – ₹ 109 |
| Debt to Equity –0.90 |
| Return on Equity – 10 Years – 14% |
| Return on Capital Employed – 10 years – 22.7 % |
| Compounded Profit Growth – 10 years –6% |
| Stock Price CAGR – 10 years – 10% which is Ok. |
| Institutions Shareholding Holding – 37% which is very good. |
As you can see from the above, the company’s foundation looks good. After careful analysis, we firmly believe this is the best stock for swing trading this week.
Technical Analysis of Bata India Ltd: –
According to our technical analysis, Bata India Ltd is trading approximately 35% down from its lifetime high. It’s on our radar based on our tried and tested moving average strategy. As you can see in the chart below:-
( For a better understanding of charts you can visit tradingview.com )
Our tried and tested Moving Average Strategy is based on three moving average indicators which are 20MA, 50MA, and 200MA. The moving Average is basically the average price of a particular stock for a certain period. For example, 20 MA means the average price of 20 days of a particular stock.
Bata India can go towards its lifetime high shortly. It can also go down a bit from here as stock is under pressure, but it cannot stay low, because as we discussed it’s the largest company in its segment.
As per the values, we can say it can have an upside movement of 23% approx from the current price at the target of 1760 in the upcoming days.
As we discussed in the previous post of the series ( Best Stocks for Swing Trading this week ) these types of companies are struggling with Net Profits (not from the sale point of view only profits) because of the increased Repo rates by the RBI (Reserve Bank of India) and increased Crude oil prices.
But in the upcoming days as RBI will reduce the Repo rate and Crude price will go down, these companies will again post higher net profits, and hence the stock price will follow. This is the reason why we strongly say that Bata India is one of the best stocks for swing trading this week amongst the two that we recommended above.
Note – The information is for education purposes only. We are not a SEBI-registered advisory. Please consult your financial advisor before trading or investing money in the stock market.
CONCLUSION –
As we have seen time and again swing trading strategies can provide numerous opportunities in the stock market for trading. In this article, we covered all the important factors that make Both Asian paints and Bata India the best stocks for swing trading this week. Both stocks fundamentally and technically look good and have a strong potential to show an upside move. Thus, this is a great opportunity for traders to grab and trade.
Happy investing!!!
