The Hindu Business Line : Stealing the show

STEEL stocks continued to remain firm on Thursday, as there was across-the-board buying in most of the counters. Dealers said the interest in the counters is due to two factors. The main factor is the restoration of DEPB benefits to steel exporters. These benefits were stopped earlier this year following the rise in the steel prices due to increased steel exports from India. Another factor is good financial performance of Korean steel major Posco, which reported excellent results earlier this week.

The talk is that Essar Steel will be the major beneficiary of DEPB benefits. This was also the major reason for the sharp rise in steel stocks. Dealers said the sharp rise in the stock price of Essar Steel was due to active purchases from FIIs.

Major steel stocks to rise on Thursday included Essar Steel (up 20 per cent at Rs 23.40 on BSE), Mukand (up 18.75 per cent at Rs 20.90), SAIL (up 8.5 per cent at Rs 32.55), Tata Steel (up 4.32 per cent at Rs 327.20) and Jindal Iron and Steel (up 6.78 per cent at Rs 222.85).

Firms up on textiles strength

SINTEX Industries was another stock to see increased buying on Thursday. The stock price of the textile and plastic company gained 11.91 per cent at Rs 128.70 on the BSE with volumes of 1.08 lakh shares; on the NSE, it closed at Rs 128.25, up 10.75 per cent, with volumes of 1.35 lakh shares. Dealers said the rise in the stock price was due to the interest of market players in textile sector, as the company's almost 40 per cent of the business comes from it.

Moreover, the stock price is quoting at a very attractive valuation compared to other textile companies. The recent acquisition of shares by the promoters has also attracted interest in the stock.

Driven by valuation

AUTO components company Ramakrishna Forgings stock gained sharply on Thursday. The stock gained 12.14 per cent at Rs 31.40 on the BSE with volumes of 1.03 lakh shares and on the NSE at Rs 128.25, up 10.75 per cent, with volumes of 1.35 lakh shares.

Dealers said several market players have started accumulating this stock. The talk is that the financial performance of the company is good and it has good order positions.

The stock was listed early this year but due to the fall in overall market the interest in the stock also vanished. Now some players feel that the valuations are attractive at current levels compared to other auto components companies .

Virendra Verma

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