The rally in the paper stocks started after the installation of the domestic industry friendly BJP government at the centre. The buoyancy in the paper stocks has been supported by an expectation of sops in the form of anti-dumping duty. The paper sector has been passing through one of the worst phases and most of the scrips were hammered to an all-time low.

However, the marketmen now expect a revival of the industry fortunes. Tamilnadu Newsprint staged a smart rally on the BSE with the scrip gaining 69 per cent in a little over one month. The scrip, which was languishingaround Rs 22 on March 4, scaled to a high of Rs 37.95 on April 8.

On April 3, 1.16 lakh shares of TNPL were traded at a price of Rs 30.4 and in the following five trading sessions, the scrip touched a high of Rs 37.5. TN Newsprint's net dropped 37 per cent in 1996-97 and 11 per cent for the first-half of 1997-98. Marketmen, however, do not expect any major improvement in the full-year performance of the company.

ITC Bhadrachalam's scrip has shown a 54.34 per cent gain on BSE in the past one month. From a low Rs 29.9 (volume 7,450 shares) on March 4, the scrip shot up to Rs 46.15 (volume 3.9 lakh shares) on April 8.

Ballarpur Industries also shot up by 50.75 per cent in the month gone by. The scrip, which was quoting at Rs 26.6 on March 4, is currently trading at Rs 40. In the past four trading sessions, the scrip has seen a steady rise from Rs 35.65 on April 2 to the current level of Rs 40.1. Ballarpur Industries' net profit dipped by over 80 per cent to Rs 8.9 crore during the first-half period of thecurrent fiscal.

Ballarpur is now reducing its dependence on pulp imports and plans to increase its pulping capacity from 300 to 370 tonnes per day (tpd). Orient Paper's scrip also staged a smart recovery and gained almost 62 per cent in the past couple of weeks. The scrip rallied from a low of Rs 26 on March 4 to a high of Rs 42 on April 8.

Andhra Pradesh Paper Mills has also risen from Rs 510 on March 4 to Rs 650 on April 8, an appreciation of 27 per cent. In the past three trading sessions, the scrip jumped from Rs 591 to Rs 650. West Coast Paper Mill showed similar gains on bourses with the scrip rising from Rs 30 on March 5 to Rs 38.

In the past couple of trading sessions, some of the other paper stocks like Star Paper Mills, Aurangabad Paper Mills, Mysore Paper Mills and Rama Newsprint and Papers have also started rising. An anticipated seven per cent rise in demand for paper has given a fresh lease of life to paper stocks.