The Hindu Business Line : Bombay Dyeing stock makes gains

THE Bombay Dyeing stock today moved up on major bourses on concerted buying by a section of investors. Dealers talked about another possible attempt by a certain market players to corner the stock.

It may be mentioned that jute baron Mr Arun Bajoria along with some of his associates and family members had acquired more than five per cent stake in Bombay Dyeing a few years ago. After touching an intraday high of Rs 161.55, the stock closed at Rs 157.60, up 17 per cent from pervious closing of Rs 134.65 on the Bombay Stock Exchange. Yesterday it had recorded a gain of 17.65 per cent.

The counter's traded quantity also increased today. It clocked a volume of 5.26 lakh shares on the BSE and 8.73 lakh shares on the NSE. A handsome 41.48 per cent of the traded quantity was presented for delivery on the NSE.

According to Ms Priya Madani of Anagram Stockbroking, the restructuring in the textiles business and VRS plan are expected to reduce operational cost. "At today's BSE close, the traded at 15.9 times its annualised earning per share of Rs 9.9 this fiscal," she pointed out. The projected dismantling of quota regime (under WTO) from 2005, textiles manufacturers such as Bombay Dyeing with large capacities and strategic relationships, are likely to benefit.

According to brokers, the third buy-back programme of Bombay Dyeing, announced recently, through open market purchases at a revised price of Rs 90 per share, may prove to be unsuccessful considering the present market valuation.