The Hindu Business Line : Talk of fund buying

PROPELLED by rumours that a large block deal may be witnessed at around Rs 495 levels, the Reliance counter witnessed sustained buying interest on the bourses on Friday.

The stock moved up 3.07 per cent to end at Rs 488.90 with around 32.50 lakh shares traded on the BSE.

The market grapevine has it that one of the participants in the deal (which is to take place on Monday, August 2) is leading Singaporean Fund, Temasek Holdings. The identity of the seller is yet to be ascertained.

Market watchers maintain that the Fund is looking at India with a 4-5 year perspective and has been bullish on counters such as Tata Motors, Maruti, Escorts etc in the recent past.

In that perspective, the stock makes for cheap valuation. Commenting on the probability of such a deal being in the offing sources reasoned that anyone taking an India view and with an interest in commodities was bound to look at Reliance.

Brokers also said that Kotak Securities was actively mopping up shares at the counter on Friday.

On monsoon hopes

In a sharp turnaround in sentiment, auto and cement stocks rallied sharply on Friday amidst hopes that the sustained rainfall over the past few days is the harbinger of news that monsoon will be above normal.

Sources said that so far the market had expected the worst for this sector and now there appears to be some hope that it may be otherwise. This change in sentiment is due to the fact that the Met department figures reflect an improvement in monsoon, which has so far been below normal.

Thus the large majority of individuals who were short on auto, cement stocks came forward to cover their positions today.

Bajaj Auto (at Rs 822.15), Hero Honda (Rs 428.90), Tata Motors (Rs 423.20) all closed firm on Friday. Similar was the case with cement stocks as ACC (at Rs 239.60), Gujarat Ambuja Cement Ltd (Rs 278.15) and Grasim (at 980.85) ended higher.

Deeptha Rajkumar

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