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Thursday, Sep 29, 2005

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Talbros gets pinched in arbitrage

TALBROS Automotive Components has been on the slide over the last few days. The stock is down 20 per cent since last week. On Wednesday, the stock was down 3.38 per cent at Rs 111.35 on the BSE with volumes of 11.27 lakh shares.

Dealers said the fall in the stock price has nothing to do with the current fear in the market about small- and mid-cap stocks. Moreover, the stock is in the B-2 group and the fear of delisting also looks unlikely.

The main factor for the fall is the company's public issue, which closed recently. The issue was priced at Rs 102. The talk is that several traders who had applied for shares in the public issue and are likely to receive large number of shares are selling in the market. By doing this, they are taking the arbitrage opportunity between the public issue and market price.

BEML rises ahead of public issue

IF one stock is declining after the public issue, another is rising ahead of the public issue. The company in this case is Bharat Earth Movers Ltd (BEML).

The talk is that several traders are pushing the stock price of the company ahead of the public issue. The issue is likely for dilution of government stake. But some traders are sceptical about the public issue due to the opposition by the Left parties.

Another reason for the rise in the stock price of BEML is good order position, especially from defence.

On Wednesday, the stock rose 9.57 per cent at Rs 935.65 with volumes of 2.18 lakh shares on the BSE; on the NSE, it closed at Rs 936.20, up 9.61 per cent, with volumes of 4.03 lakh shares.

Agro Tech up on value buy

AGRO Tech Food, an MNC into processed food business, is being accumulated by a section of the market players.

The main factor for the accumulation is good financial performance of the company and a possible turnaround in this fiscal.

The buzz is that the company has established itself in the food business over the last few years and is doing well in some parts of the country. The company, which owns brands such as Sundrop, Rath, has expanded into various processed foods and its brands recall is also good.

On Wednesday, the stock rose 9.66 per cent at Rs 112.40 on the BSE with volumes of 6.70 lakh shares; on the NSE, it closed at Rs 112.90, up 9.61 per cent, with volumes of 4.91 lakh shares.

Virendra Verma

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