Gladiator Stocks - TeamLease Services - ICICI Direct

Strategy

Buy TeamLease Services in the range of Rs. 3150.00-3250.00 for target price of Rs. 3820.00 with a stop loss of Rs. 2878.00. Time Frame: Six months

Technical View

- The stock has recently generated a resolute breakout above the long term supply line joining the previous major highs of CY18 (Rs. 3309) and CY19 (Rs. 3210). Also, it is seen sustaining above the same signalling a structural turnaround. Thus, it offers a fresh entry opportunity

- We expect the stock to resume its primary up trend after last two week's breather and head towards Rs. 3820 levels as it is the value of the upper band of the rising channel in place since May 2020

- The entire up move since bottoming out in May 2020 is well channelled. The lower band of the channel has provided fresh entry opportunity on multiple occasion. The stock is currently placed near the lower band of the channel. We expect it to maintain the rhythm and resume fresh leg of up move

- Structurally, it has completely retraced its 23 months decline (Rs. 3309 to 1420) in just nine months. A faster retracement in less than half the time interval signals strength and robust price structure

Fundamental View

TeamLease Services (TLS), established in 2002, is one of India's leading providers of human resource services in the organised segment with ~6% share in the flexi staffing industry. TLS' services span the entire human resources supply chain covering employment, employability and education. Employment services include temporary staffing solutions, IT staffing and regulatory consultancy for labour law compliance while employability offerings include learning and training solutions

TeamLease's general staffing business continues to be on a strong footing and is attractively placed to grab the opportunity in the least penetrated temporary staffing market in India. Further, we expect labour reforms, push for local manufacturing and aim of India to be a global supply chain will further benefit TLS in the long run. The company has significantly reduced its core associates and could manage higher growth with lower associates, going forward, due to digitisation of business. This, coupled company increased revenue contribution from specialised staffing & lower compliance dost is expected to boost margins of the company in long run. Hence, we remain positive on the company from long term perspective

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_GladiatorStocks_Teamlease_Feb21.pdf

Shares of TeamLease Services Ltd was last trading in BSE at Rs.3447.3 as compared to the previous close of Rs. 3311.1. The total number of shares traded during the day was 2691 in over 808 trades.

The stock hit an intraday high of Rs. 3508.5 and intraday low of 3255. The net turnover during the day was Rs. 9103841.

Source : Equity Bulls

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