Daawat (Long Term Strategy)

2020년 10월 23일

Hi Everyone,

Here is an interesting pattern update on Daawat , we can see Daawat has formed an Ascending Triangle . These patterns trend may be either bullish or bearish

Two Scenarios for this pattern:

1. We need to see a price break above 55-56 with a volume accumulation and this confirms the next new high in the near future. The trend will continue to be bullish
2. Price Break below 46-48 with OBV going down along with selling pressure which tends to be bearish and should stay away

Fundamentals:

1. Daawat is the No. 2 branded basmati segment in India and also has a global presence
2. Their majority of the revenue is from basmati rice selling both B2b and B2c. As we can see recently, the management is adapting to consumer needs and they are entering new segments within the rice category and trying out the needs of consumers with different range of products. Management expects the company to grow faster than the sector
3. If my guess is not wrong, they might become the next big FMCG company in the Rice industry through their forward integration strategies and this is the biggest tailwind for this company.
4. Covid-19 has given the company great tailwinds and the quarterly results speak for itself
4. Company has good cash flow along with reducing debt levels which is a good sign for long term

For Investors:
1. It is always good to analyze the Fundamentals and buy the share, but it is always good to buy if all the odds are in your favor.
2. Fundamentals looking good, Technical set up looking good (Please see the Two scenarios), Long term outlook looking good
3. Company is a branded segment and No.2 in India and Basmathi segment
4. It is good to accumulate the share if it crosses above 55 and buy the dips during the US elections

Initiating a Longterm Buy above 55 for a target of 70-80 in 6 months to 1 year
Initiating to stayaway from stock below 46

Thank you and hope you are enjoying the analysis. Please do follow me for more updates, please like and comment :)

Disclaimer: This is an educational Advice not a financial advice