Financial Daily from THE HINDU group of publications
Saturday, Dec 13, 2003
Financial Daily from THE HINDU group of publications Saturday, Dec 13, 2003 |
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Markets
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Stock Markets Tea stocks hot up on higher demand hopes
Jayanta Mallick
Kolkata , Dec. 12 IS the cuppa hot for the stock market this winter? Not really, if you go by the tea experts. However, tea counters had been on the oven since the beginning of December. Stocks of tea companies, such as Tata Tea, Goodricke Group, Jayashree Tea and Assam Tea, have gone up substantially on expectation of price rise and reported increase in demand. Opening at Rs 259 on December 1, the Tata Tea stock has gone up to Rs 314.15 at today's close on the BSE. Jayshree Tea has steamed ahead from the level of Rs 52 to Rs 77. (On Tuesday, the stock had scaled up to Rs 95 before closing at Rs 87.10). The Goodricke counter price rose to the level of Rs 69 on Wednesday from Rs 38 on December 1. The Assam Tea stock went from Rs 23 to over Rs 40. It closed at Rs 37.10 today.
According to brokers, some of the stocks in the sector had seen gains of around 80 per cent albeit on a lower base. The tea industry sources maintain that the optimism is misplaced. The Indian Tea Association statistics showed that the production till October end was up 32 million kg compared to last year. Production last year was 702 million kg. The exports have been lower by 43 million kg. Though imports till September were down by 12 million kg, available tea in the market was over 60 million kg, say ITA sources. According to Mr C.K. Dhanuka, ITA president: "There is no indication of a dramatic turnaround as of now. Early signals suggest that the export market may firm up for quality teas only in the coming months. The good news is that price is not falling further in the domestic market after a long gap. The average domestic auction price is up by say around Rs 10 a kg from rock bottom." The auction figures in the six centres throughout the country also did not show much of a difference in activity compared to last year. Till October 31, about 360 million kg changed hands compared with 361 million kg for the corresponding period of last year.
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