Nifty may expire between 5700-5750 in Oct series: ICICI Sec

October futures and options contracts will expire next week. In an interview to CNBC-TV18, TS Harihar, co-head institutional derivatives of ICICI Securities says it looks like the expiry could be in the range of 5,700-5,750.  "I think it is very unlikely that we could see a very sharp breakout in this expiry," he adds.

Also read: Nifty has resistance at 5730-5750, says Sudarshan Sukhani Below is the edited transcript of his interview with CNBC-TV18's Udayan Mukherjee and Sonia Shenoy. Q: What is your call on the Nifty now? A: At the current point in time, it looks like the expiry could be in the range of 5,700-5,750 because the build up of calls on 5,800 and puts on 5,600 is quite strong. So, it does seem likely that the range, at this point of time, maybe between 5,700 and 5,750. I think more important issue is that we have a shorter expiry this time. The expiry is just about three trading days away including today. So, I think there is going to be a little bit of volatility. But with the vols at about 14.6, which is probably one of the lows we have had I a long time, I think it is very unlikely that we could see a very sharp breakout in this expiry. Post this expiry, we could have a breakout. But this expiry could still be in the range below 5,750. Q: You have got some positive takes on the auto ancillaries. Exide comes in with its numbers today. You have got buys out on names like Exide and Apollo Tyres. A: We have been expecting that, sooner rather than later, there should be an indication of a cut either in the rates or CRR. If that happens, I think the rate sensitives are going to benefit substantially from that. The problem is that most of the large auto companies like Maruti or even Tata Motors have not been announcing very encouraging numbers month-on-month. So, the benefit could trickle down to the auto ancillaries rather than to the major auto companies. We find two stocks that are fundamentally good and have also been seeing buying interest. One is Apollo Tyres and the other is Exide Industries. We have a 10 percent upside in one month’s time for both of these stocks. Q: What is the mood that you are getting on the banking space, ahead of the RBI policy?  Are there any trades that you would advise in any of the frontline banking names? A: We are seeing a lot of optimism getting built up on most of the banks. I must highlight that the optimism seems to be more pronounced in the private sector banks. Yesterday, we saw a very sharp upmove on Axis Bank. It bounced from about Rs 1,140 to about Rs 1,210. That was a very sharp move. Most of the accumulation is happening in the private sector banks and not so much in the public sector banks. The expectation is that either a rate cut or a CRR could happen in this particular credit policy. Banking is probably one sector that is leading this rally. It also seems to be the sector with the maximum accumulation of long positions.