Financial Daily from THE HINDU group of publications
Wednesday, Jul 06, 2005
Columns - Ear to the ground
Reliance Capital betting on new biz plans
WITH consistent news flows about the expansion plans of the company, the stock of Reliance Capital has been buoyant at the bourses. The stock touched an intra-day high of Rs 393 on Tuesday before closing at Rs 379.25.
The current interest in the stock is because of speculation that the company is entering the insurance sector. Media reports have suggested that Reliance Capital is one of the bidders for the business of AMP Sanmar.
Dealers say that whether this specific deal comes through or not, investors are taking heed of the fact that the company is aggressively expanding its operations into various new areas of business. The acquisition of majority stake in Adlabs Films is seen as the first step in a series of announcements, dealers speculate.
Seen healthy on fund buying
THE stock of Elder Pharmaceuticals was a big buzzer on Tuesday. It touched its 52-week high of Rs 232 today and closed the day with a gain of 11.9 per cent at Rs 218.60.
Institutional investors have been showing interest in this stock, according to market participants. Citicorp International Finance Corporation (CIFC) picked 7.5 per cent stake in the company through a preferential allotment in May. Subsequently, it also bought further shares through secondary market purchases. Currently, CIFC holds 13 per cent stake in the company.
The promoters of the company are also understood to have sold some stake in the market today.
Out of steam
THE stock of VSNL, which has been soaring after the announcements of its global plans, is letting off steam now. The stock touched its 52-week high of Rs 280.70 on Monday, after the company announced the completion of its acquisition of Tyco. The company had also talked about entering other global markets, including South Africa.
Dealers say that the impact of new businesses has now been factored into the share price and analysts do not see too much of gain in the short-term.
The stock lost 3.24 per cent during trade on Tuesday and ended trade at Rs. 260.20. Brokers have been advising clients to book profits at these levels.
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