Financial Daily from THE HINDU group of publications
Friday, Sep 10, 2004
Financial Daily from THE HINDU group of publications Friday, Sep 10, 2004 |
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Stock Markets Markets - Commentary Columns - Sensor A good day for mid-cap engineering stocks S. Vaidya Nathan
IT was a listless day for equities with a splash of red dominating the scorecard. Even in the category of small-cap and mid-cap stocks that have been on an uptrend in recent weeks, profit-bookings led to weakness. The CNX Mid-Cap 200 Index shed about 1.25 per cent. The Nifty closed the day at 1649 points with a loss of 0.44 per cent for the day. The Sensex was flat at 5298 points. It was, however, a good day for engineering sector stocks; barring a few exceptions, banking and pharmaceutical stocks ended the day with losses. Vardhaman Spinning and Mahavir Spinning ended the day lower even as an announcement of restructuring came in after trading hours. A demerger of Vardhaman Spinning and the merger of a part of its textiles business with Mahavir Spinning have been proposed. The likelihood of a favourable court ruling on a long-pending excise case pepped the ITC stock as this would obviate the need for sizeable payments and also lead to a write-back of substantial sums charged as provisions in earlier years. Legal proceedings did not, however, pan out in favour of another Nifty stock. Topping the losers in the Nifty was the stock of Zee Telefilms. The possibility of a fresh bidding process for the telecast rights of cricket matches in India spooked the stock, which lost about 5 per cent. Zee and ESPN-Star Sports have been directed to submit fresh bids by September 15, as the hearing commenced on a petition by the latter in the Mumbai High Court. Zee had been awarded the contract for its $308 million bid and planned to start a channel dedicated to sports, Zee Sports. The legal proceedings have now imparted a high degree of uncertainty. Nervousness about business plans was reflected in trading as the stock slumped as news of the court proceedings filtered in. A host of mid-cap engineering sector stocks notched gains on a listless day of trading. The likes of Crompton Greaves, Cummins India, Atlas Copco, Havell's India, Greaves Cotton and Blue Star attracted investor fancy. A sister concern of the Blue Star also had a fine outing. On a day when information technology stocks remained on the sidelines, the stock of Blue Star Infotech was in the limelight. A software development order from a pharmaceutical major, which could serve as a reference point, revved the stock; the stock ended the day with a gain of 10 per cent. A few mid-cap stocks such as Madras Cements, Monsanto and MRF that have been fancied over the past few weeks, however, managed to sustain the momentum. The Madras Cements' stock sported smart gains on a day when cement stocks were on sluggish terrain. Several stocks that have been on a relentless uptrend in recent trading took a breather in Thursday's trading. Micro Inks, United Phosphorus, Aban Loyd Chiles, 3M India, Alfa Laval and Praj Industries shed value as the momentum appeared to taper off. In the small-cap space, the Rain Calcining stock attracted fancy after languishing for several weeks. It was among the top 10 gainers for the day with a spurt in volumes as 4.6-million shares were traded. It was a lacklustre day for banking sector stocks. A host of them, straddling the large-cap and mid-cap domain, such as Bank of Baroda, Punjab National Bank, Oriental Bank of Commerce, Bank of India, Vijaya Bank, Andhra Bank and Union Bank of India declined by between 2.5 per cent and 3.5 per cent. Stocks of Corporation Bank and Kotak Mahindra Bank bucked the trend to end the day in positive territory. If Wednesday was `pharma's day out', several pharmaceutical stocks were done in on Thursday's trading. MNC stocks such as Pfizer and Aventis shed most of the gains that they accumulated on the previous day. Indian pharma stocks fared no differently, with only Nicholas Piramal and Matrix Labs bucking the broad trend. Other prominent gainers included Lumax Industries, Kothari Products, Coromandel Fertilisers, Herdillia Chemicals, Jindal Photofilms, FourSoft, SPIC, Nirma, Hindustan Lever and Zuari Agro. Prominent in the list of losers of the day were Snowcem, Suven Pharmaceuticals, Bharti Tele-Ventures, Great Eastern Shipping, Jagsonpal Pharma, Birla Corp, Motherson Sumi Systems, Elgi Tyres, Venky's India and Carborundum Universal.
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