Financial Daily from THE HINDU group of publications
Tuesday, May 31, 2005
Financial Daily from THE HINDU group of publications Tuesday, May 31, 2005 |
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Markets
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Stock Markets Columns - Ear to the ground India Cement active on cheap loan hopes Jayanta Mallick
Going by the Dalal Street grapevine, India Cement has paved the way for further interest cost reduction. After its debt restructuring with domestic banks through a one-time settlement earlier, the company has now understood to have negotiated a soft loan deal of around $120 million with a Hong Kong-based asset reconstruction company. According to dealers, some serious investors seemed to have turned their attention to the stock on the basis of the new development which, if true, will increase the profitability of the company. Analysts pointed out that the South-based cement manufacturer has already been enjoying firmer product price trend. "In the South, monsoon does not lead to slump in cement demand as in other regions during the June-July period. Rains generally affect construction work in December in the southern states. It is expected that in the coming months India Cement will consolidate its position further on the continuing construction boom," a fund manager said. The company with its subsidiaries has a total of 9 million tonne capacity. However, its enterprise valuation is much lower than its asset valuation in terms of green field capacity costs, an analyst observed. The stock today closed at Rs 76.10, down 3.30 per cent, after opening strong at Rs 79.50 following some active calls.
Some betting on growth plans Bayer Crop Science stock is the target of certain market makers, who believe the profitability of the company may improve this year in a big way. According to market sources, the agro chemical company has lined up launch of four new products this year. "Expectation of a normal monsoon coupled with new launches and greater market share, the Rs 824-crore company, whose financial year ends on December 31, is poised for a quantum jump. The price is woefully low compared to its peers such as United Phosphorus. The stock price, however, is yet to reflect the enthusiasm borne by some market players. It closed 1.08 per cent lower at 215.10. But a `strong recommendation' by a string of key players may change the alchemy of trading in the counter, feels market source. A very small institutional holding (FIIs hold 1.23 per cent and domestic MFs have around 0.64 per cent while foreign promoters hold 71 per cent) leaves an opportunity of market value-rejig in view of the company's aggressive growth plans, a dealer mentioned.
Advanced Micron Devices up on order talk
The counter of Advanced Micron Devices is moving up on unconfirmed news that the company has been witnessing a surge in its order book positions. According to market sources, the credit card reading equipment and medical instrument making company is riding on the retail and healthcare boom. In the last three months, the company is said to have seen significant increase in orders from mushrooming mall stores, new healthcare outfits as also on the export front. The Bangalore-based product company has also been witnessing improvement in margins, market sources felt. It is understood that a majority stake acquisition last year by Opto Circuits in the company has given it additional opportunity in exploring the parent's export channels. The stock on Monday moved up 7.61 per cent to close at Rs 43.85 with a traded quantity of over two lakh shares on the BSE.
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