Financial Daily from THE HINDU group of publications
Saturday, Aug 10, 2002
Financial Daily from THE HINDU group of publications Saturday, Aug 10, 2002 |
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Markets
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Stock Markets VSNL chief talks the stock up Jayanta Mallick
KOLKATA, Aug. 9 VSNL recovered in the last hour of the trading session on Friday on the National Stock Exchange and the Bombay Stock Exchange and closed with a gain of around 2 per cent. According to NSE dealers, the recovery came around 3.15 pm from a level of Rs 121.55 following a statement by the VSNL Managing Director, Mr S.K. Gupta, that the company was not alarmed by the dues from the beleaguered WorldCom and the payment for April was expected shortly. After that, the stock shot up to Rs 128.90 and it finally closed at Rs 125.10 on the NSE. On the BSE, the recovery began after 3.21 pm. Mr Gupta confirmed his positive views on the issue to Business Line over telephone from Mumbai. According to the VSNL Managing Director, the company had no reason to believe that the dues would not be cleared by the US telecom company, which had made payments for March. WorldCom is still the US carrier for calls emanating from VSNL. VSNL received last payment in July. Earlier, in a statement to the BSE, VSNL had declared that it was to receive payment estimated between Rs 294 crore and Rs 441 crore from the bankrupt WorldCom and had not obtained assurance regarding clearance of the dues from the US firm. During the financial year to March 31, 2002, gross revenue of VSNL from WorldCom was around 14 per cent of the total operating revenue of the Indian telecom company. The trading volume steadily grew today in the VSNL counter. At close, the combined volumes in the VSNL stock on the two bourses stood around 4.5 lakh shares. According to Mr Abhay Aima, Chief of the Equity Research Cell of HDFC Bank, if the worries over the WorldCom dues subside, the valuation of the stock is likely to firm up. "The real estate assets of the company, which is to be hived off to a different company, have the potential of additional valuation of Rs 50 per share. If the review committee (which is currently looking into the proposal) shoots down the proposed investment in Tata TeleServices, then further unlocking of valuation is a distinct possibility", Mr Aima added.
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