Financial Daily from THE HINDU group of publications
Wednesday, Oct 06, 2004
Columns - Ear to the ground
Grasim buoyed by VSF expansion plans
REPORTS of Grasim planning another expansion in its VSF business over the next 18 months have reportedly allayed market concerns of the possibility of a slowdown in the company's profitability in financial year 2006 and 2007.
Brokers are of the opinion that the counter could come in for a re-rating soon. Analysts maintain that the company's plans signal the re-emergence of growth in VSF (Viscose Stable Fibre) business. This is also said to have addressed the fears of stagnating demand in the company's highest ROCE (return on capital employed) generating business.
The stock hit an intra-day high of Rs 1,190 but came of its high to close at Rs 1,171.80 on the BSE on Tuesday with around 73,108 shares traded.
Shipping stocks gain
WHILE rumours of a special dividend added an extra sheen to the stock of Shipping Corporation of India (SCI), reports of wet cargo rates going up by 102 per cent in the spot market over the last two weeks lent an optimistic undertone to the sector as a whole.
Brokers said that given that this would beef up the company's bottom line shipping stocks did come in for select buying interest.
While SCI ended the day 5.5 per cent higher at Rs 161.05 with around 10 lakh shares traded on the BSE, GE Shipping ended at around Rs 168.15, up almost one per cent, with around 2.86 lakh shares traded.
Amtek gains on re-rating hopes
THE stock of auto ancillary company Amtek Auto, which had come in for a stock split on Tuesday with a face value of Rs 2, is said to be on its way to being re-rated on the bourses.
The company, which is in the process of merging its privately held group companies with itself, has also been attracting interest on account of the fact that it is going in for an ADR.
Analysts maintain that the company's recent overseas acquisition also indicates its decision to look at outsourcing in a major way.
On a consolidated basis, the company is looking at an EPS of Rs 90, for March 2005, say analysts. The stock ended at Rs 150.35 on Tuesday on the BSE.
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