The Hindu Business Line : HFCL gains on huge volumes

The company's stock price gained 9.66 per cent at Rs 8.40 on the BSE with volume of 1.80 crore shares and on the NSE it closed at Rs 8.40, up 9.80 per cent, with volume of 2.40 crore shares. The volume was substantially higher than its average volumes. Out of the total shares traded, 64.62 lakh shares (35.8 per cent of shares traded) were for delivery on the BSE and on the NSE 94.10 lakh shares (39.2 per cent) were for delivery.

There were several block deals in the counter. On the BSE, there was a deal of 49.94 lakh shares, which were sold by Venus Series Trust A/c ITF Mauritius at Rs 7.55. The firm also sold 48 lakh shares at Rs 7.56 on the NSE. The buyers of these shares were not known.

But brokers said the buying of these shares were done by some local investors who are bullish on the stock. ``Stock price of HFCL had fallen sharply in the last few months and several investors now see value in it at current levels,'' said a dealer with a domestic broking firm.

The main reason is the restructuring of the company's loans with its financial institutions. HFCL had earlier informed that all the loans from financial institutions, banks and others have been rescheduled under Corporate Debt Restructuring (CDR) scheme approved by CDR Empowered group and its impact will be considered on approval by the respective lenders.

It also informed that the company is in the process of segregating the investment and financial assets into a separate company. ``The restructuring exercise is in process and will help the company to focus more on its core activities of manufacturing of telecom products, turnkey operations and R&D initiatives,'' the company had informed the stock exchange after the March 2004 results.

However, some brokers said the shares of the company keep moving from one investor to other and it is very difficult to know the reason for this. Moreover, they said the company reported loss both at operating and net level for the financial year ended 2004. On net sales of Rs 749 crore, it reported operating loss of Rs 179 crore and net loss of Rs 262 crore.