The Hindu Business Line : CLSA buys over 2% in PSL

According to the exchange, CLSA bought a total of 8.69 lakh shares. Out of these, 4.57 lakh shares were bought from Deutsche Securities (Mauritius) at Rs 81.4 a share. The balance, however, was not detailed by the exchange.

Share trade

The stock had dipped to its 52-week low of Rs 81.25 on NSE on Monday. But it finished at Rs 87.25 with a gain of 3.75 per cent. At one point the stock had recovered to Rs 89.90.

The total number of shares traded on the NSE was a record 8.95 lakh, while on BSE, some 4,136 shares changed hands.

Despite fairly strong fundamentals, the stock has under performed the Sensex this year.

New facility

The company’s subsidiary, PSL North America LLC, commissioned a new pipe manufacturing facility at Port Bienville Industrial Park in Mississippi in October.

The $100-million facility on 156 acres is strategically located along the Gulf Coast just outside the Bay St. Louis. It is now preparing to execute orders worth over $ 400 million acquired May this year. It is also participating in the new tender processes such of GAIL.

According to Mr Paresh Jain, an analyst with Religare, till the end of first half 2008-2009, PSL had orders worth Rs 6,000 crore justifying revenue visibility over the next few quarters. “It is currently fetching a very low P/E 2.3 on FY10 estimated earnings,” he said.

Margins & Risk

According to analysts, the present downturn in metal prices would also help it improve margins going forward.

They, however, point out that an unspecified currency risk looms as the company said that the impact of foreign exchange rate fluctuation in recent times had not been given effect to in the results. It will consider accounting for it at the end of the financial year.

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