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Our Bureau

Unitech remains firm despite weak sentiment; Ansal Buildwell, Ansal Housing lose by 60%

Mumbai , July 17

Stocks riding on the construction sector boom have been one of the biggest victims in the recent meltdown, leaving investors with a big hole in their pockets.

But, a study by Construction World, a construction sector magazine, showed that several stocks including Unitech, IVRCL, Noida Toll Bridge and Gammon India have survived the fall to a certain extent.

Several stocks, including Ansal Buildwell and Ansal Housing, lost about 60 per cent from the peak levels, while UB Engineering, MSK Projects, Patel Engineering, Shalimar Paints and Subhash Projects declined by a more than 45 per cent.

In contrast, Unitech stood almost unaffected in the fall. "Unitech was hardly affected as it fell by only 3.3 per cent - indicating a strong, sturdy and loyal investor base that has probably invested with a long-term view," said Mr Pratap Padode, Editor of Construction World.

Stocks of Gammon India, Nitco Tiles, IVRCL, HCC, Noida Toll Bridge, Nagarjuna and BL Kashyap among others, fell by less than 40 per cent from peak.

Measure of fall

Since the fall in the Sensex was 30 per cent, all shares that have fallen by up to 45 per cent could be considered largely the victims of a weak market sentiment, the report said. But those stocks that fell by 45 per cent or more would indicate an involvement of a higher speculative element in their holdings.

The market fell from a historic high of 12,671.11 on May 11 to its lowest level this year of 8,799.01 on June 14.

Among construction companies, Era Construction had shown maximum appreciation - its market capitalisation had risen by 1,985 per cent, according to the report. Share prices of UB Engineering, MSK Projects, Patel Engineering, Shalimar Paints and Subhash Projects have been hit by a more than 45 per cent fall, indicating fragility in the ownership pattern.

Cement, steel, tiles, stones, paint, aluminium, wood, sanitaryware, electricals all hold great scope for the long term investors, he said, adding that in all these sectors the best brands will be safer and surer in offering returns.

Other companies that have shown better capacity to withstand this speculative element despite the crash include Arrow Granite, JK Cement, Regency Ceramics, Ingersoll Rand, Century Plyboards, Uniply, Jindal Stainless, Sintex, ACC, L&T, Pidilite, Anant Raj Industries, Cera Sanitaryware, BHEL, Gujarat Ambuja Cements, Voltas, Welspun Gujarat, Man Industries, Goodlass Nerolac, Asahi India Glass, Berger Paints, Asian Paints and PSL, all of which fell by less than 45 per cent.

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