Govt may not sale its SUUTI stake in Axis Bank at such low prices---
CMP: 417
Buy on dips around 407-400;
TGT: 430-452-465 (1-3M)
TSL<395
Note: Consecutive closing below 395 for any reason whatsoever, Axis Bank may further fall to 385*-350 & 310-275 in the mid to long term (alternative bear case scenario).
Axis Bank was under pressure as analysts are apprehending off late about effectiveness of the SDR/CDR packages & 5:25 scheme on the whole banking sector. It may be another instrument by which Banks can hide their stressed assets for more time.
Another issue was that as par various reports, Govt is mulling its 11.7% stake in Axis Bank through SUUTI to meet shortfall of its FY-16 disinvestment target. However, some Govt sources also indicated few days ago that there is no such plan on the table as of now.
Considering the recent historical price range, it makes no sense for the Govt to sell stake in Axis Bank at such low prices and in that scenario, it will fall more.
Technically, the scrip may be in the B-Wave of the monthly EW cycle and the extended target of the same may be near 465. For the present down trend of the Axis Bank to be changed, it has to close consecutively above 465 for any upwards movement up to 535-560 in the mid to long term.
Analytical Charts:
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