The Hind Lever Chemicals Ltd counter has been witnessing lot of action for the past five trading sessions. The scrip has moved from Rs 323 on December 24 to Rs 417-level. The action is mainly on account of company's decision to issue equity shares to foreign institutional investors (FIIs) on a preferential basis. The fertiliser arm of Hindustan Lever Ltd will be utilising proceeds of this placement to fund its expansion.

The company board is meeting January 4 to consider this proposal. The company is planning to issue 22.5 lakh equity shares/debentures to FIIs.

Riding high on hive-off plan

Enkay Texfoods (`Onjus' brand) as part of its restructuring exercise is planning to hive off textile division into a separate company. The board is scheduled to meet on January 7 to take a decision on this. The market has welcomed the company's proposal as the scrip in four trading has zoomed from Rs 17 to Rs 25.8. In fact for past two days, the scriphas been hitting the upper end of the filter on BSE. On Thursday, on BSE, nearly 89790 shares changed hands on the counter. With the company concentrating on high growth processed food segment, the valuations for the stock is likely to improve in near future.

According to sources, the company is likely to dispose off its textile unit once it is transferred into a separate company. The marketmen expect the unit to fetch a good price as despite a slump in the industry the unit is not making losses. The company might use the raised funds for investment in its food-processing division. The company proposes to invest over Rs 250 crore in the food-processing division in the next three years.

In less than two years time Onjus has captured a 19 per cent share in the domestic tetrapack beverages market. The company has recently launched `Life Mango Nectar'. Before the success of its juice textile division was flagship of the company. For the year ended August 31, 1997, revenues from the textiles division were Rs314.41 crore, contributing nearly 79 per cent of the total. This division manufactures texturised, twisted and dyed yarn from Bhilad, Gujarat, and a new facility in Kherdi in the Union Territory of Dadra and Nagar Haveli. For the seven month period ended March 31, 1998 the company reported a net profit of Rs 10.28 crore. The company also paid a 20 per cent dividend(annualised) for 1997-98.

On the rise again

Berger Paints seems to be on the rise once again. The stock has appreciated by more than 20 per cent in less than a week. The rise could be attributed to the 20 per cent interim dividend announced for the quarter plus the news of talks with some foreign companies for a possible tieup. The merger of Rajdoot Paints with Berger Paints has also aided sentiments in the counter. Whatever the reason, the bear-run in the counter (after the stock went ex-bonus) has been halted for now. After the post-bonus low of Rs 46.40, the stock has now appreciated to Rs 56.

Financially, Berger Paints has managedto withstand the economic slowdown and posted good results. In the first-half of 1997-98, it earned a net profit of Rs 11.72 crore, up 37 per cent from the corresponding period in the last fiscal. Berger Paints also managed to post higher operating and gross profit margins compared to the corresponding previous period, thanks to the enhanced range of products and its expanded reach.

In the decorative segment (which contributes nearly 70 per of the total revenue), the company has been continuously launching products.

It also managed to stay in tune with the recent innovations in the industry by introducing the `Colour Bank' tinting systems for emulsion and enamel paints. Berger Paints is also entrenched in powder-coating (used in consumer durables) and heavy-duty coatings (used in the construction industry).