Financial Daily from THE HINDU group of publications
Saturday, Jan 08, 2005
Financial Daily from THE HINDU group of publications Saturday, Jan 08, 2005 |
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Markets
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Stock Markets Columns - Ear to the ground Capacity expansion fuels energy
THE counter of Petronet LNG has been on the rise in the last few days. On Friday, the stock gained sharply to close at Rs 42.60, up 19.16 per cent, on the BSE with volumes of 12.54 lakh shares; on the NSE, it closed at Rs 43, up 20 per cent, with volumes of 34.86 lakh shares. Dealers said the interest in the stock is due to the company's increased capacity for LNG. The setting of the company's new LNG terminal in Kochi is also considered positive for the company. Several institutional investors are bullish on the stock as they feel that LNG (liquefied natural gas) has huge growth potential and in the next few years this would be seen in the company's financial performance.
Flying high on FIIs buying WITH Jet Airways planning to enter the primary market, interest in shares of Royal Airways (erstwhile Modiluft) has picked up. Several FIIs have bought its shares in the last few days. Dealers said the interest in the stock has been spurred by reports that the new management, which has taken over the company, plans to start operating the domestic flight as a low cost carrier. The good response to unlisted Deccan Airways is also bringing interest in the stock. The talk is that the Indian aviation industry is set to grow fast as opposed to developed markets where growth is slowing down. Several FIIs that have seen the growth of low cost carriers in developed market are bullish on Royal Airways even before the company has made its plans public. On Friday, the stock price of the company gained 8.55 per cent at Rs 40 on BSE with volume of 64.85 lakh shares.
Haunted by `downgrade' fears
AFTER the sharp fall in the stock market on Wednesday and Thursday, market players have turned cautious on the future trend. This caution comes in the wake of downgrade by leading Dutch Bank on Wednesday, which led to the sharp fall in the stock prices especially index stocks. This bank, in a note to its clients, said India did indeed outperform in December and is now downgrading India to `neutral'. The downgrade is purely based on valuation concerns but there are worries on the strength of flows running into the Indian market, which is beginning to look climactic. Dealers now fear that in the short term (two-three weeks) FIIs' inflows might slow down. There is also concern that the flows may shift to other emerging markets in the region as this bank has upgraded the Philippines and Malaysia to `overweight'. The fear is that if more foreign broking firms come out with this kind of advisory report this would halt the bullish sentiment prevailing in the market.
Virendra Verma
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