Financial Daily from THE HINDU group of publications
Thursday, Apr 11, 2002
Financial Daily from THE HINDU group of publications Thursday, Apr 11, 2002 |
|
|
|
|
|
Markets
-
Stock Markets Omax Autos rides high on Hero Honda growth Virendra Verma
MUMBAI, April 10 THE share price of auto ancillary company, Omax Autos Ltd (OAL), has more than doubled in the last one month on good order flows from Hero Honda Motors. The share price has increased from Rs 100 to the current levels of Rs 220 on the BSE. The stock ended the day 9.81 per cent higher, with volumes of 78,798 shares. Analysts said that the outlook for OAL looked bright as its main customer, Hero Honda, was performing well. OAL manufactures sheet metal tubular and machine components for the automobile industry. There has also been some talk of the company announcing a liberal bonus issue in the ratio of 3:1 (three shares for every one share held). The main reason why analysts and market players are expecting a liberal bonus issue has been the low equity base of Rs 3.23 crore and floating stock in the market. "The company has been showing good profit growth for the financial year 2001-02 and the future looks bright in view of the growth in the motorcycle segment," said an auto analyst. For the nine-month period ended December 31, 2001, OAL net profit increased by 62 per cent to Rs 12.31 crore. While sales were up 37 per cent at Rs 332.23 crore during the same period, the performance of the company in the current fiscal is expected to be good due to the impact of the capital expenditure undertaken last year, analysts said. In 2001-02, capital expenditure to the tune of Rs. 15.81 crore was incurred by the company mostly to build capacities to meet the increasing demand from Hero Honda. Last year, in a communication to its shareholders, OAL said "our esteemed customer Hero Honda has manufactured 10.29 lakhs motorcycles in the year 2000-01 and plans to manufacture around 13 lakhs motorcycles. Your company, being a single source, is also gearing up to enhance its capacities to meet this ever increasing demand." The interest in the stock could further go up following the company's plans to diversify into emission control system, effluent treatment, waste management, power generation, renewable energy and hospital businesses.
Send this article to Friends by E-Mail
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | Business Line | The Sportstar | Frontline | Home |
Copyright © 2002, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line
|