Calcutta, July 7: Equity research has mushroomed over the last couple of years with the entry of several foreign institutional investors into the Indian capital markets. Some of them, like W I Carr, started as research outfits and have now acquired broking cards on major bourses.

In the melee of stock recommendations, there are few who can boast of good and accurate forecasts. There are innumerable examples of how leading research outfits have prima facie goofed up their recommendations.

Jardine Fleming made a buy recommendation two years back on Videocon International at Rs 225. Those who bought on the advice are rueing their misfortune as the scrip went on a tailspin ever since the recommendation was made public and is ruling currently at Rs 30.

More recently, James Capel B & K went wrong in at least five cases. In its June 1997 stock recommendations, it put five scrips on the `sell' list. These include Cochin Refineries at Rs 134 (market price on July 4-Rs 140); ICICI at Rs 61 (now Rs 88); Tisco at Rs 168 (now Rs 218); Asian Paints at Rs 280 (Rs 350) and IPCL at Rs 121 (Rs 139).

Similarly, SCOGEN-Crosby blundered in as many as 10 cases in its May 1997 report. It put the following in `sell' category. ITC at Rs 427 (Rs 534); BHEL at Rs 311 (Rs 401); ACC at Rs 1,402 (Rs 1,512); Tata Chemicals at Rs 158 (Rs 190); Nestle at Rs 226.80 (Rs 287); Indian Rayon at Rs 318 (Rs 381); Dr Reddy's at Rs 208.50 (Rs 279); Tata Steel at Rs 165.50 (Rs 218) and Reliance at Rs 268 (Rs 357). Raymonds was put on `hold' at Rs 83.50 and is now trading at lower level of Rs 67.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.