RBI MPC outcome will be the focal point for the week

Nifty slipped in Friday’s trade, pressured by weak global cues and renewed worries over stretched valuations in the AI and tech space.

The 2-big questions:

1) Has the recent rally run out of steam?
2) Can Nifty recover after Friday’s sharp sell-off?

For now, the correction appears more like profit-booking rather than a trend reversal. The index is expected to consolidate and attempt another push toward its all-time high of 26,277.35.

The 2-Biggest Headwinds in near term:

1) Concerns over stretched AI valuations remain.

2) Rapidly fading expectations of a December U.S. Fed rate cut.

Despite the caution, Nifty bulls could regroup on backdrop of optimism surrounding a potential US–India trade agreement.

Please note, despite the steep 50% U.S. duty, India’s export decline has been relatively moderate, giving policymakers leverage — especially with growing signals of a potential tariff rollback.

GDP Snapshot:

India’s GDP growth data for the quarter ending 30 September 2025 is due on Friday, November 28th. The economy previously expanded 7.8% YoY in Q1 FY26, accelerating from 7.4%, marking the strongest growth in five quarters. Markets will be keen to see if this momentum continues.

Bottom-line: Nifty may rise, but volatility shall persist; also due to November F&O expiry due this Tuesday.

Now, as we step into a fresh week and also into a fresh month, all eyes turn to auto sales figures for November, releasing on Monday, December 1st. Apart from that, all eyes will also be on November GST Collection figures.

Also, Meesho’s Rs. 5421.20 crore IPO is set to open for subscription on Dec 3, 2025 and closes on Dec 5, 2025. The allotment is expected to be finalized on Dec 8, 2025. Meesho IPO will list on BSE, NSE with a tentative listing date fixed as Dec 10, 2025.

But the focal point of this week will be the RBI MPC outcome, to be wired on Friday, December 5th. As the Reserve Bank of India (RBI) prepares to announce its monetary policy next week in the backdrop of benign inflation, stable liquidity, and robust macroeconomic conditions, expectations are high that the central bank will cut its repo rate by 25 basis points to 5.25%. The RBI has held rates at 5.5% since August after a cumulative 100 bps of cuts in the first half of the year.

The Nifty options data suggests Nifty is likely to be in a trading range of 25500-27000 zone. Maximum Call OI is at 26000 followed by 27000 strike prices. 27000 mark is now Nifty’s major resistance zone on closing basis. Maximum Put open interest stands at 26000 levels followed by 25000 levels. Call writing was seen at 26300 and then at 26500 strike price, while there was meaningful Put writing at 26100 and then at 25900 strike prices.

Price Forecast:

Nifty CMP (26203)
Support : 25940/25500
RESISTANCE: 26600/26851
RANGE: 25955-26477
200 DMA: 24578
Nifty PCR: 1.21
BIAS: Positive

Bank Nifty CMP (59753)
Support: 58200/57000
RESISTANCE: 60500/62000
RANGE: 58700-60300
200 DMA 54737
BankNifty PCR: 1.19
BIAS: Positive

Preferred trade for the week:

Nifty (26203): Buy on dips between 26122-26133 zone. Targets at 26375/26600. Aggressive targets at 26850 zone. Stop at 25920.

TOP SECTORS

Bullish Sectors: BANKS, IT, AUTO, METALS

Bearish Sector: MEDIA, FMCG, POWER

STOCKS IN FOCUS:

BULLISH VIEW: FEDERALBNK, RELIANCE, SBIN, PGEL, ASHOKLEY, M&M, NUVAMA, SRF, HEROMOTOCORP

BEARISH VIEW: GAIL, TIINDIA, ASTRAL, KAYNES, CAMS, SBILIFE, PERSISTENT, SOLARINDS, DIXON, SHREECEM, PAGEIND, BOSCHLTD, POLYCAB.

Kalyan Jewellers India

BUY

CMP 505

Target Price 600
Stop 431
52 Week H/L 794.60/399.20
P/E 56
EPS (TTM) 8.93
Promoter Holding/FIIs/DIIs/FIIs/Public 62.77%/14.12%/14.56%/8.54%
Book Value 51.70
Market Cap (INR) 52186

Company Overview:
Kalyan Jewellers was founded in 1993 by T. S. Kalyanaraman, with its first store in Thrissur, Kerala and now is one of India’s largest jewellery retailers with a network of 315+ showrooms across India, the Middle East, and beyond.
It offers a wide range of products: gold, diamond, gemstone, platinum and more — catering to different customer segments.
In addition to physical retail, Kalyan expanded its online presence after acquiring full control of online jewellery-brand Candere in 2024.
In short: Kalyan Jewellers is a full-scale, pan-India (and global diaspora) jewellery chain, building on decades of legacy and scaling up both offline and online presence.

Key Strengths & Competitive Advantages:

Strong retail footprint + brand equity: With 300+ stores and presence across tier-1 to tier-3 cities, the company enjoys broad visibility and reach.
Omnichannel presence: Offline + online (via Candere) helps capture both traditional buyers and younger, digital-first consumers — giving flexibility in changing demand dynamics.
Diversified product mix & market segments: From mass-market jewellery to premium offerings, across gold, diamond, and gemstone reduces reliance on a single customer segment.
Strong Q2 FY26 performance: The recent surge in profit and revenue suggests improving demand, better cost control, and rebound in consumer sentiment.

Scalable growth via store expansion + changing consumer preferences: Rising disposable incomes, festive demand, and a shift toward branded jewellery over unorganized retail favor listed players benefit jewellers like Kalyan.

Risks & Challenges

Gold-price volatility: Jewellery demand is sensitive to gold price fluctuations; sharp spikes can hurt demand and margins.

Working-capital intensity & inventory risk.

Key Financial Results (Q2FY26):

(Q2 FY26), Kalyan Jewellers posted a net profit of Rs. 260 crore, nearly doubling from ₹130.3 crore in the same quarter last year.

Revenue from operations rose 30% year-on-year to Rs. 7,856 crore in Q2 FY26.

On an annual scale, the company’s turnover grew sharply over the years according to one source, TTM revenue is now close to Rs. 29,000+ crore.

In terms of profitability metrics: Return on Capital Employed (ROCE) is around 15%, Return on Equity (ROE) ~ 16%.

Market cap stands among the top in the jewellery retail space.

Technical Outlook: The stock at the moment is signalling massive consolidation breakout on the upside, confirmation of strength above its biggest hurdles at 530 levels. The stocks 200-DMA is placed at 517 levels.

Preferred Strategy: Look to buy at CMP, and on dips between 460-475 zone, targeting 530/565, and then aggressive targets at 613 mark. Stop below 431. Holding Period 9-12 Months.

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