However, this time the stock failed to show any appreciation prior to the results' announcements. In fact, within a period of four trading sessions prior to a day before results were announced, the stock fell by Rs 13. And when the results were announced, the stock was up by Rs 8.20. But if one were to add the book-closure badla of Rs 9.25, the stock has fallen by Rs 1.25 yesterday. The stock entered into its no-delivery period on Monday at the BSE.

While overall sentiment could partly be blamed for this, twoholidays during the week have also restricted operators from taking any fresh position. Besides, on the NSE, the scrip will enter into a no-delivery period only on Wednesday.

While the actual direction would only be known on Wednesday, fundamentals however support a bright outlook for the company. The prices of polyester fibres and yarn have been rising. Though prices of polymers are still expected to be under strain, the increase in volumes would more than compensate for the drop in prices. The company has plans for putting up a new polypropylene plant in Jamnagar having a capacity of 0.4 million tonnes. Thanks to the south Asian crises, around 10 mega projects are being cancelled and 30 odd being shelved off. This has eased the demand supply situation and marketers claim that now there are more chances of prices increasing. The drop in oil prices to $14 per barrel has meant lower prices for naphtha -- the basic raw material for Reliance. Considering that the company would continue to operate at fullcapacities, analysts expect net profit to record a 10 per cent jump in the first quarter of 1998-99. And the stock market should positively react.

Kakatiya Cements: Rising interest

In a scenario where mergers and acquisitions in sectors like cement and pharmaceutical have been a common factor, rising interest on the counter of Kakatiya Cements has not come as a big surprise. In the last two months, the stock has appreciated by almost 100 per cent. Though merger appears a possibility, observers feel that Kakatiya's plant capacity of 1.98 lakh tonne may not attract many players. Besides, Kakatiya's investments in sugar business is also likely to discourage the raider. Kakatiya has acquired 10 per cent stake in Sree Kailas Sugars and Chemicals (SKSC) at a cost of Rs 1.45 crore. Reports suggest that under the rehabilitation scheme for SKSC, merger with Kakatiya has been favoured. As on March 1997, on an equity of Rs 14.48 crore, SKSC had an accumulated losses to the tune of Rs 19 crore. Tough themerger would provide a tax-shield to Kakatiya, it would also require it to pump in around Rs 49 crore. This amount, though not out of reach, is quite large compared to Kakatiya's balance sheet. For 1996-97, the cash profit at Kakatiya stood at Rs 8.72 crore, down from Rs 11.68 crore in the previous year. Although these factors do not support a takeover, rising stock prices supported by huge jump in volumes and shareholding pattern indicate that something positive is happening of which the stock market is aware of. While the share prices jumped from Rs 15 to the current level of Rs 29 within a period of two months, daily volume on this counter has moved up from around 1,000 shares to 13,000 shares. As per the shareholding pattern as on March 1996, the public holds around 60 per cent whereas the promoters and group companies control around 30 per cent.