ACC Ltd bear strategy : STraTegy for proFit

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Shares of JK Lakshmi Cement jumped nearly 11 per cent after the company reported over two-fold jump in consolidated net profit for the fourth quarter.
Leading cement makers, Representative image, Photo by Rodolfo Quiru00f3s on Pexels.com

Cement maker ACC Ltd on Tuesday announced 6.64 per cent decline in consolidated net profit at Rs 323.02 crore for the March quarter 2020, impacted by volume decline during the lockdown last month. Stock is expected to witness a fall in the prices in coming days after a 200 plus points rally in the last few days.

ACC is India’s foremost manufacturer of cement. Rating agency ICRA had reported, “Domestic cement demand is likely to affect adversely due to the lockdown to control coronavirus infection and would recover only in the second half (H2) of 2020-21 post the monsoon season.”

Brief about ACC March quarter results:

6.64 per cent decline in consolidated net profit at Rs 323.02 crore for the March quarter 2020,

Total revenue from operations was down 10.65 per cent to Rs 3,501.71 crore during the quarter.

ACC’s cement sales volume in March quarter 2020 was down 12.06 per cent to 6.56 million tonne as against 7.46 million tonne.

Its total expenses in January-March 2020 were at Rs 3,083.78 crore as against Rs 3,555.84 crore in the year-ago period.

How to earn profit from ACC stock?

Strategy: Sell future of ACC @ 1336.75 , Buy 1340 CE @ 48.00and Sell 1200 CE @24.50. We suggest selling out of the money call to reduce the reduce the overall cost of the option position.

ACC Ltd's stock is expected to witness fall in the prizes in coming days after 200 plus points rally. Company reported 6.64% decline in the consolidated net profit.
ACC ltd

Stock have rallied sharply in last few trading sessions.But it hit recent high with falling volume. Candlestick analysis showed bearish trend after two consecutive Doji candle on daily chart. RSI is near important resistant level of 60 and is in overbought zone on stochastic.

ACC Ltd's stock is expected to witness fall in the prizes in coming days after 200 plus points rally. Company reported 6.64% decline in the consolidated net profit.
ACC ltd

Keep stop loss around 1176 with a target of 910 Rs.

Stock is unlikely to expected to rally in current market scenario.Globally also stock markets are experiencing sharp fall after surprise crude oil plunge yesterday.Last night, the NYMEX WTI Crude futures May 2020 contract settled at an unprecedented USD (-)37.63 a barrel, after slipping into the negative zone on fears of fast-filling storage facilities globally and an unprecedented plunge in demand due to the novel coronavirus pandemic.

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