The Hindu Business Line : Value buying lifts Tata Teleservices

THOUGH the overall market sentiment dipped today, the stock of Tata Tele Services (Maharashtra) saw unabated cornering by a select group of domestic players.

The stock moved up by 3.38 per cent to Rs 22.95 on the BSE and clocked significant volumes on the major bourses.

The counter has been witnessing higher level of volumes for the last three sessions. The stock's 52-week high is Rs 25.40.

According to dealers, after the FII ceiling in the Bharti counter was touched and prospect of this low-value stock brightened, a section of the local market players started accumulating the stock in the hope of future premium.

On the NSE, the counter witnessed a record volume of 1.42 crore shares, of which 29.7 per cent was presented for delivery. On the BSE, there were 98 block deals, whereas on the NSE block trade figure was placed at 371.

The company is to declare its quarterly results on May 13. According to analysts, the market is not only expecting better results but also some direction from the company regarding consolidation of businesses in the near future.

Mr Ketan Thacker of Anagram Stockbroking pointed out that Tata Tele has aggressive plans to increase wireless phone (both mobile and fixed) market share, from the current 4 per cent to an ambitious 20 per cent in the next three years.

By September, the company is expected to spread its networks to 600 cities from the present figure of about 50. According to the company's set target, by March 2005 it is likely to have services running in 1000 cities and towns.

As per the shareholding pattern on December 31, 2003, the FII investment was at 8.97 per cent, while the promoters' holding was placed at 70.83 per cent. The company has planned to issue foreign currency convertible bonds for overseas investors to a limit of $ 150 million in principal amount. The conversions would be made in tranches. It also plans to increase its authorised share capital to accommodate such conversions into equity.

However, the market's current attention is not on increase in the capital base, but on thepotential in valuation growth and a possible increase in attention by the FIIs.

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