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Sowmya Sundar

FRESH exposures can be contemplated in the stock of Carborundum Universal at the current price of Rs 180. The business outlook appears good due to the better growth prospects for its key product - abrasives - growing demand for ceramic products, and the probability of a turnaround in its electro minerals division, which had acted as a drag on earnings in the April-June quarter.

The strength in the user industries such as automobiles, auto-components and engineering sectors would support growth in the abrasives business. The pick-up in exports, which account for 9 per cent of revenues, also augurs well. The rising share of the ceramics business in the revenues - its share at 17 per cent was up four percentage points in 2002-03 - could bolster earnings as it generates higher margins than other divisions of CUMI.

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