The Hindu Business Line : Shree Rama Multi-Tech moves up on HLL order

THE stock price of laminated tube manufacturer Shree Rama Multi-Tech has been moving up over the last month as the company has bagged a large order from FMCG major Hindustan Lever Ltd (HLL).

Shree Rama will supply laminated tubes to be used for packing toothpaste, creams and other cosmetics from HLL.

In the last one month, the stock price has moved from Rs 13 to today's closing price of Rs 19.30 on the BSE, a rise of 48 per cent. The stock today gained 15.22 per cent on the BSE with 8.27 lakh shares being traded. On the NSE, it closed at Rs 19.40, up 13.12 per cent, with a volume of 4.59 lakh shares.

Brokers said the jump in the stock price is mainly due to the company bagging the order from HLL.

Talking to Business Line, Mr Vikram Patel, Chairman and Managing Director, Shree Rama Multi-Tech, said: "We have got an order of Rs 100 crore from HLL for laminated tubes to be executed in 2005-06 and another order of the same value for 2006-07".

Unilever has also approved the company as a preferred vendor for export of laminated tubes and other packing items, he said.

Brokers said the company is also undergoing a debt restructuring and its impact would be visible over the next few quarters.

There is also talk of stake sale to some European private equity investors. Mr Patel declined to give details on restructuring and on private equity, as the matter was subjudice.

A meeting of the creditors would be held on March 22 for restructuring under Section 391 of the Companies Act, followed by a shareholders meeting on March 28, he said.

The company is facing a deep financial crisis and analysts feel that the debt restructuring and orders from HLL are likely to improve its health .

For the financial year ended December 2004, the company reported net loss of Rs 65.61 crore on net sales of Rs 65.09 crore.

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