The Hindu Business Line : Expansion move buoys Lanxess

Lanxess ABS, formerly Bayer ABS, which is executing a major capacity expansion of ABS and Styrene, has raised market expectations over substantial boost to its earning per share. The stock gained over 3 per cent on Wednesday and in the last one week by around 10 per cent. During the calendar 2006, the company has doubled it capacity and slated to treble capacity in 2007, according to the management.

Street expects an EPS between Rs 17 and Rs 20 (up from Rs 9.26 in 2005) in tune with rising sales for the year to December 31, 2006. Earnings are expected to go up by another 40 to 50 per cent, which translates to a P/E ratio of around 7 (based on current market price of Rs 180.50) in the calendar year 2007.

Unconfirmed news also indicates that the debt-free company has sold off some surplus land in Mumbai.

Jayanta Mallick

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