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Thursday, Feb 07, 2002

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PSU stocks take market on joy trip

Our Bureau

MUMBAI, Feb. 6

AFTER a long time the stock market witnessed a bull run led by PSU shares today. The upturn was fuelled by the Government's decision to divest its stake in IBP, VSNL and plans to dilute stake in HPCL and BPCL by July.

Apart from PSU stocks, active buying was also seen in bank stocks and some IT counters.

The benchmark index Sensex ended 115.66 points or 3.49 per cent higher at 3,427.39, on across-the-board buying. At NSE, the S&P CNX Nifty closed at 1113.1, up 38.85 points or 3.61 per cent.

However, major action was in PSU stocks as was evident in the BSE PSU index, which gained 126 points or 11.16 per cent to close at 1,255.72.

Since opening, all the Sensex PSU stocks from HPCL, BHEL to MTNL and SBI were up sharply on the back of the Government decision on disinvestment. Other PSU stocks such as Engineers India, Indian Oil, IPCL, National Aluminium, Shipping Corporation and Container Corporation were also up.

Dealers say the Government had boosted sentiment in the markets by going ahead with the disinvestment process. The fact that the IBP and VSNL disinvestment processes did not get into rough weather as that of Balco provided the much-needed confidence for the markets on privatisation.

WIth this smooth passage, most of the PSU stocks are expected to be in the limelight in the days to come. Some of the PSUs that have already attracted market attention include Shipping Corporation, Container Corporation and oil majors - HPCL and BPCL, which are expected to be on the block very soon. Neyvelli Lignite, the latest PSU to be put on the disinvestment block, was also locked in the 20-per cent upper circuit.

Other than PSU stocks, multinational pharma stocks such as EMerck, Glaxo and Pfizer were also on the rise on the back of the new drug policy. Analysts perceive these companies could be benefited with some major drugs coming out of the DPCO (Drug Price Control Order).

Some of the banking stocks such as State Bank of India, Corporation Bank and Bank of India were also up.

The mood was quite upbeat and analysts said that it would continue to remain strong.

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