Financial Daily from THE HINDU group of publications
Friday, Nov 05, 2004
Usha Martin gains on export potential
Mumbai , Nov. 4
THE stock price of steel manufacturing company Usha Martin has been on the rise over the last few days on huge growth potential for the company's product in the export market.
Export order from elevator maker Otis has also attracted the interest of market players.
In the past few days, the scrip has moved from Rs 60 to today's closing price of Rs 79.25 on the BSE, a rise of 32 per cent.
In Thursday's trading, the stock gained 7.68 per cent with volume of 4.44 lakh shares on the BSE; on the NSE it closed at Rs 79.25, up 7.31 per cent with volume of 7.80 lakh shares.
Brokers said that the interest in the stock was due to various projects undertaken by the company, which would benefit it in the next 18-20 months.
One of the expansions being undertaken by the company is investment of Rs 155 crore in a captive mining enterprise and the funds for the expansion are expected to be from internal accruals.
The Kolkata-based company is also planning to double its export in the current fiscal. Last fiscal, exports accounted for over Rs 200 crore.
According to analysts, the company is aiming to become a leading global players in wire rope in the next few years.
"Wire rope would give the company a good niche market," said an analyst with a domestic broking firm.
Recently, the company bagged an order from elevator company Otis to supply specialty wire ropes for three years. However, the exact amount of the order was not known.
Otis will use the specialty wire rope for its customers in Asia and west Europe.
This order is expected to contribute around 15 per cent of the company's total wire business, the analyst said.
Usha Martin is also looking at opportunities to supply high-performance mining rope to North America, where it has been supplying some quantity of medium-level mining ropes, he added.
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