Chana Spread Report 2012

Chana Spread Report 2012

Chana Spread Call Strategy Sell April & Buy May Target Stop Loss -40 to -20 -130 & -200 40
Kunal Shah Ankita Parekh Ravi Dsouza

Research Team
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+91 22 3926 8037

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Taking the historical analysis into consideration, we have seen the spread between April and May has remained in contango. The spread has widened to 100 on an average and 250 in extreme cases. This year also we expect the current contango to widen towards expiry supported by the following reasons.

April - May Spread

2008 100 50 0 Spread -50 -100 -150 -200 -250 -300 1 5 9 13 17 21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 81 85 89 93 97 101 105 109 113
No. Of Days
Source: NCDEX, NB Research

2009

2010

2011

2012

Usually the new domestic crop arrives in the market by March and is expected to be delayed this year due to adverse weather conditions. As a result of which market may witness the arrival pressure to continue till mid April. On the demand supply scenario, we expect chana crop this year to be around 46-47 lakh tonnes compared to 50 lakh tonnes last year. Further, a tight supply scenario is painted in the year ahead on the back of negligible carry forward stock for the year 2012. Carry forward stock is expected be around 0.5 lakh tonnes compared to 1.8 lakh tonnes in 2011 which goes to show that markets would remain supported after the arrival pressure eases. TRADING CALL: - SELL APRIL AND BUY MAY NEAR -40 to 20 TGT -130 and -200 SL 40

Nirmal Bang Commodities Pvt. Ltd.

Chana Spread Report 2012

RESEARCH TEAM Name Kunal Shah Devidas Rajadhikary Vikash Bairoliya Harshal Mehta Sunit Mehta Vinod Maloo Ravi Dsouza Somya Dixit Subhash Lalwani Ankita Parekh Designation Research Head - Commodities Technical Analyst Research Analyst Technical Analyst Research Associate Technical Analyst Research Associate Research Associate Research Associate Research Analyst E-mail

kunal.shah@nirmalbang.com
devidas.rajadhikary@nirmalbang.com vikash.bairoliya@nirmalbang.com harshal.mehta@nirmalbang.com sunit.mehta@nirmalbang.com vinod.maloo@nirmalbang.com ravi.dsouza@nirmalbang.com somya.dixit@nirmalbang.com subhash.lalwani@nirmalbang.com

ankita.parekh@nirmalbang.com

Disclaimer: This Document has been prepared by N.B. Commodity Research (A Division of Nirmal Bang Commodities Pvt Ltd). The information, analysis and estimates contained herein are based on N.B. Commodities Research assessment and have been obtained from sources believed to be reliable. This document is meant for the use of the intended recipient only. This document, at best, represents N.B. Commodities Research opinion and is meant for general information only. N.B. Commodities Research, its directors, officers or employees shall not in any way be responsible for the contents stated herein. N.B. Commodities Research expressly disclaims any and all liabilities that may arise from information, errors or omissions in this connection. This document is not to be considered as an offer to sell or a solicitation to buy any securities. N.B. Commodities Research, its affiliates and their employees may from time to time hold positions in securities referred to herein. N.B. Commodities Research or its affiliates may from time to time solicit from or perform investment banking or other services for any company mentioned in this document. Address: Nirmal Bang Commodities Pvt. Ltd., B2, 301 / 302, 3rd Floor, Marathon Innova, Opp. Peninsula Corporate Park, Ganpatrao Kadam Marg, Lower Parel (W), Mumbai - 400 013, India.

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