The Hindu Business Line : Revamp talk fuels activity in Manali Petro

MARKET attributes the recent rise in volumes in the Manali Petrochemicals stock to the intelligence that the company is likely to wipe out its Rs 56-crore accumulated losses by setting them off against the Rs 115-crore share capital.

The proposal, hammered out in consultation with SBI Capital Markets, will be effected by halving the face value of each share to Rs 5.

While the company itself is mum about the proposal, sources in SBI Caps and IDBI (a major shareholder) say that Manali Petro intends to come back in the dividend list in the current year by erasing off its losses.

Market sources point out that the company has been making profits continuously for the last 20 months and is likely to close the year with more gains than previously.

The stock closed the day weak at Rs 7.49 with 1.14 lakh shares being traded.

Gains on order talk

RUMOURS of the company being close to bagging an export order for auto components from China, propelled market interest in the stock of Ashok Leyland on Thursday.

The counter witnessed large volumes on the bourses, though price wise there was no sharp upsurge.

Unconfirmed reports of the strike at the company's Hosur plant as having been finally resolved also served as a shot in the arm.

There is a perception that the company would see a 12-13 per cent volume growth for the entire year.

The stock ended the day at Rs 20.35, up 2.01 per cent, with around 51.06 lakh shares traded on the BSE. On the NSE, the stock ended at Rs 20.30, up 1.50 per cent, with around 1.01 crore shares traded.

Value buying seen

A perception that the stock of Birla Corporation is undervalued on account of the Birla-Lodha issue aided market interest at the counter.

Dealers said that while the cement cycle gaining momentum has impacted the stock positively, the price is not a reflection of the true value.

Analysts maintain that at current valuations, Birla Corp shares are priced at $44 EV/ton, one of the lowest in the sector.

The M&As in the cement industry in the recent past have taken place at $80EV/ton which in itself reportedly leaves a huge upside potential for the stock price.

A moot point to note is that the company has taken note of its most important manufacturing cost, power, through captive generation.

The stock ended at Rs 133.85, up 6.99 per cent, with around 2.02 lakh shares traded on the BSE.

M. Ramesh
Deeptha Rajkumar

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