The Hindu Business Line : Thiru Arooran stock rises on turnaround

THE stock price of Thiru Arooran Sugars has risen by over 185 per cent since the beginning of this month mainly due to the company coming out of red in the March quarter.

For the quarter, the company reported net profit of Rs 9.28 crore compared to net loss of Rs 14.39 crore in the previous two quarters (June-December). For the financial year ended June 2003, the net loss was Rs 14.5 crore.

Brokers said the turnaround in the March quarter has resulted in sharp rise in the stock price. Since the beginning of April, the stock gained 188 per cent from Rs 33.60 to today's closing price of Rs 95.30 on NSE.

In today's trading, the stock of the company gained 10.05 per cent at Rs 95.30 with volume of 62,473 shares on the NSE; on the BSE it closed at Rs 94.15, up 9.99 per cent, with volume of 13,775.

Industry experts said the financial performance of the company is in line with the performance of other sugar companies. "Price of sugar is increasing since the beginning of this year, the performance of most of the companies has to be good," said an industry expert.

But the stock price of the company has outperformed other sugar companies since April this year.

Some market players said the sharp rise in the stock price is unwarranted as the entire industry is likely to benefit from the rise in sugar price. "There is possibility of some brokers cornering the shares of the company," said a dealer with a domestic broking firm. "The floating stock of the company's shares are very low compared to other sugar companies' shares and this is the main reason for the rise in the stock price."

He said shares price of other sugar companies has not increased in the same way despite their good performance.