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Saturday, Nov 02, 2002

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With turnaround sighted, LML sees better volumes

Our Bureau


THE stock market today reacted to the LML second quarter results with moderate optimism. On the Bombay Stock Exchange, though the price gain was marginal, the traded quantity more than trebled. The stock closed at Rs 36.60 (Rs 36.50) with volumes of 66,510 shares on the BSE. Yesterday, the stock had recorded a volume 19,539 shares, up from Wednesday's quantity of 2,930, on the BSE.

After the announcement of the quarterly results on Thursday, the volumes started picking up, brokers pointed out.

According to analysts, reduction of net loss to Rs 3.85 crore from Rs 25.22 crore in the first quarter and Rs 18.80 crore in the second quarter of 2001-2002, is the signal for a possible turnaround by the end of the current fiscal.

The negative earning per share came down to Rs 0.88 from Rs 5.78 at the end of first quarter. The book value of LML share stands at Rs 16.07.

The two-wheeler maker is expecting a clear turnaround by the end of the fourth quarter. Mr R.D. Jayal, Senior Vice-President of LML, told Business Line that the company was in the process of returning to the profit path. "The second quarter results have established that the 110-CC deluxe segment motorcycle `Freedom' has been doing exceedingly well since it was launched in the second of half of July this year. A total of 30,900 Freedom bikes have been sold so far," he added.

The sale of motorcycles touched a figure of 13,500 in October, the first month of the third quarter. This was indicative of the steady growth rate of the new motorcycle from LML stable. The company would launch a 125-CC niche segment motorcycle in the fourth quarter.

Mr Jayal mentioned that LML's bottomline improvement was largely volume-driven rather than margin-triggered. Despite a substantial drop in scooter sales, the total two-wheeler sales in terms of numbers in second quarter were 41,202 units (42,214 units).

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