The Hindu Business Line : Voltas stock hits 52-week high

THE Voltas stock on Monday recorded its 52-week high on the major bourses on good order book position and growth prospects in textiles machinery business.

A section of brokers said that one of the existing investors was understood to have been picking up the stock in recent months.

The stock went up to Rs 190.20 on the BSE and finally closed at Rs 182.50 with substantial volumes. On the NSE, it closed at Rs 187.30, with a gain of 4.4 per cent.

According to Mr Shashin Upadhyay of Anagram Stockbroking, on top of a robust order book size worth Rs 1,100 crore as on September 30, further growth in orders is expected in the second half of the current fiscal.

Strong capital expenditure plans in the domestic textiles sector are likely to provide additional demand for the textiles machinery of Voltas. Voltas is the sole distributor of the spinning machines of Laxmi Machine Works.

"At today's closing price, the stock traded at 15 times its annualised first half (2004-05) earnings," said Mr Upadhyay.

Voltas has three major business divisions - electro-medical projects and services, engineering agency and services, and refrigeration and cooling units.

According to an analyst, the rising crude prices and the consequent spur in investments in infrastructure projects in the Persian Gulf countries, the major market for Voltas, have enhanced opportunities for the company to boost sales.

Market analysts also point out that the company's plan to downsize its relatively laggard refrigeration and cooling equipment business by 450 workers would have a positive impact on its bottomline.