Tech view: Will Indonesia's palm oil export ban hurt HUL, Adani Wilmar?

Among FMCG stocks, Adani Wilmar seems to be better placed at current levels as per the technical charts.

Indonesia, one of the largest exporters of palm oil to India, has proposed a ban on palm oil exports starting April 28. India meets almost 45 per cent of its annual palm oil requirement from Indonesia. READ MORE

While the US soyoil futures jumped more than 3 per cent to a record high of 84.03 cents per pound after Indonesia announced the ban, shares of domestic countries dependent on palm oil fell sharply on the bourses.

According to trade sources, the ban will cause a sharp escalation in edible oil prices which have already been on the boil due to the ongoing Russia - Ukraine crisis. 

Frontline stocks like Hindustan Unilever (HUL), Britannia Industries, Godrej Consumer Products, and Marico were down between 4 per cent and 6 per cent on the BSE. At 09:30 am; the S&P BSE FMCG index was down 1.7 per cent, as compared to 1 per cent decline in the S&P BSE Sensex. READ HERE 

Shares of Adani Wilmar, however, soared 4 per cent to Rs 763 - a new all-time high, and the stock has soared over 40 per cent so far in April 2022. 

Here's how these shares are placed as per technical charts:

NIFTY FMCG INDEX
Outlook: Defend 50-DMA

The overall outlook suggests a positive bias for the FMCG index. This is so as it broke out of the bullish pattern of “Inverse Head and Shoulder”, shows the daily chart. Yes, the present scenario looks downward, rather seems to test earlier support level of 36,333-level, which is its 50-day moving average (DMA). The index did conquer 200-DMA recently, but failed to recover as it slipped under 38,000-mark. Nevertheless, as long as the index defends 50-DMA, the trend could see a revival. Medium-term chart depicts 35,500 as the major support.  CLICK HERE FOR THE CHART
 
Adani Wilmar Ltd (AWL)
Likely target: Rs 830
Upside potential:   10%

Shares of Adani Wilmar are continuously rising upward. The bullish trend has a support of Rs 650 and until it trades above the same, the positive sentiment is here to stay. The Relative Strength Index (RSI) is effortlessly overriding the selling pressure in the overbought territory, an indication of robustness. The next reach could be to Rs 830-mark, shows the daily chart. The immediate support stands at Rs 700 level.  CLICK HERE FOR THE CHART
 
Hindustan Unilever Ltd (HINDUNILVR)
Outlook: Simultaneous closing under 50-DMA could see sell-off

After conquering 50-DMA, the stock moved to cross the 100-DMA resistance. The strength and momentum were low and hence it failed to overcome the 100-DMA, currently set at Rs 2,225 mark. Now, the counter trades under its 50-DMA showing weakness. That’s said, the counter may re-gain a positive sentiment until the Moving Average Convergence Divergence (MACD) sustains above the zero line, shows the daily chart. The outlook remains stable until the stock does not consecutively closes below the 50-DMA.  CLICK HERE FOR THE CHART
 
Godrej Consumer Products Ltd (GODREJCP)
Outlook: Needs to overcome Rs 780 mark.

A “Double Bottom” formation may induce more strength on weaknesses, as it shows a robust breakout on the daily chart. The Rs 750 to Rs 740 becomes the breakout neckline range and the present price action could see a short-term stability in the said band. The structure looks promising; however the counter needs to overcome Rs 780 mark to regain the losing momentum. CLICK HERE FOR THE CHART
 
Ruchi Soya Industries Ltd (RUCHI)
Outlook: Needs to conquer 200-DMA decisively

Shares of Ruchi Soya Industries are required to conquer the Rs 961-level decisively, its 200-DMA, to embark a new bullish trend. The stock is presently hovering around the same level, but showing a sluggish move. The major move could emerge above the Rs 1,000-mark, which seems to become the immediate hurdle, shows the daily chart.  CLICK HERE FOR THE CHART