MUMBAI, May 7: Century Textiles, which posted its worst-ever results, may repeat the feat in the current year too, say analysts, who do not expect growth prospects to change dramatically. The scrip has underperformed substantially over the past year and analysts expect the share price to come down to Rs 1,500 in three months. On Wednesday's trading it moved in the Rs 2,033.25-Rs 2,210 band.

The company's decision to keep expansion projects on hold till the markets settle down is a good strategy but makes little sense from the long-term point of view, analysts feel.

Instead of adopting a wait-and-watch attitude, the company should go in for a thorough restructuring of operations by selling off unremunerative businesses and concentrate on core sectors, they added.

The company has cited falling cement prices as one of the reasons for the poor showing but no major recovery is expected in the coming months.

Analysts say shipping will be a burden for the company as the sector is going through through troubled times. "Disposing of shipping will help the company wriggle out of the crisis," analysts said.

They were skeptical about the funding pattern for the paper project which is proposed to be implemented in the near future. "With the company's financial performance taking a beating, any form of fund-raising is impossible," analysts said. The company is optimistic about the textile sector, a view not shared by industry observers, as the European Commission will clamp definitive anti-dumping duty on its major exporting item, the cotton grey fabrics.

The only option for Century Textiles is to focus on value-added fabrics and explore new markets, analysts say. The company has already set the ball rolling by increasing the production of value-added fabrics. The performance of the textile sector, however, hinges on discovering new export markets.

At the Bombay Stock Exchange on Wednesday, bears further tightened their grip on the scrip. The scrip price fell by 9.99 per cent from the previous close of Rs 2,259. The stock was locked lower limit on the exchange at Rs 2,033.25 at which there were absolutely no takers for a net quantity of 1,710 shares. It registered a net volume of 14,158 shares.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.