The stocks of Forbes and Company and Gokak Textiles, listed companies of the Shapoorji Pallonji Group, surged on the bourses on Thursday after the group's Managing Director, Mr Cyrus Mistry, was named the successor to Tata Group Chairman, Mr Ratan Tata.

The stock of Forbes and Co closed at Rs 426.40, up 6.73 per cent and Gokak Textiles closed at Rs 56.95, up 17.42 per cent on the BSE.

Shapoorji Pallonji & Company Ltd holds 72.06 per cent stake in the company while Forbes Cambell Finance has a 1.29 per cent stake. In Gokak Textiles, Shapoorji Pallonji & Company holds 73.56 per cent stake.

However, the Tata group scrips were not as buoyant. They moved in line with the market direction during most part of the day. The stocks of the flagship companies of the Tata Group like Tata Consultancy Services, Tata Steel and Tata Motors were marginally up at the end of day's trade on Thursday.

TCS at Rs 1089.25 a share, up 2.53 per cent, Tata Steel closed at Rs 384.95, up 0.64 per cent and Tata Motors at Rs 173.15, up 2.76 per cent. The stocks of Tata Communications, Tata Coffee and Tata Chemicals increased marginally by 0.72 per cent, 1.99 per cent and 0.38 per cent respectively.

“It is the initial euphoria that has sparked the surge in the stocks of the Shapoorji Pallonji Group. While it is good to see the stocks of the Shapoorji Pallonji Group up, the stocks of the Tata Group will be on the positive side in the future,” said Mr Dharmesh Pancholi, Senior Manager- Advisory (Equity), Sharekhan.

Many market analysts said that it is too early to tell how the Tata group will perform under Mr Mistry but they have their reasons to explain the surge in the stocks of the Shapoorji Pallonji Group. “The markets react on a higher side when good news comes. The surge in the stocks could be an over reaction but only time will tell how the group will perform. Also, many people feel that this appointment will be more beneficial to the Shapoorji Pallonji Group than to the Tata group,” said Mr Amol Kshirsagar, Assistant Vice-President, Arihant Capital Markets.

Analysts also pointed out that the volumes of shares of the Shapoorji Pallonji group were very small and the scrips would therefore show a faster rise than the Tata group scrips would.

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