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FE NEWS SERVICE
Narmada Cement up on open offer prospects
An open offer prospect for the Narmada Cement shareholders at a premium to the market price has pushed up the stock price further. The scrip, which had shot up from less than Rs 10 to Rs 20 in anticipation of a takeover by L&T, continuing its northward journey. On Wednesday, the scrip touched a new two-year high of Rs 27.50. Clearly, the open offer at a 37 per cent premium to the prevailing price market is attracting investors.
Earlier this week, L&T had announced its intention to acquire Narma Cement's cements division. The construction major has already bought Chowgule's 70 per cent stake for a consideration of Rs 234 crore and now plans to make an open offer for the remaining 30 per cent at Rs 34 per share.
High LAB prices perk up TN Petroproducts
With the firming of linear alkyl benezene (LAB) prices the punters have shifted their focus to the T N Petroproducts counter. The scrip in last three trading sessions has moved up from Rs 15.8 to Rs18 on the Bombay Stock Exchange.
With the shift in consumer preference towards synthetic detergents as against the traditional choice of detergent bars, demand for LAB, a major raw material for production of synthetic detergents, is also going up. For the whole of 1998 its price was increasing, but in the last three months the uptrend has intensified. The domestic prices of LAB are currently 29 per cent higher than the respective previous year levels.
Not only have the prices of TN Petro's products gone up, but with the turnaround of Henkel Spic Limited, the company has found a captive local consumer for LAB. Henkel Spic Limited, the joint venture between SPIC and Henkel AG, produces the Henko brand of detergents. According to market sources, TN Petro is running its plant at much higher levels than its installed capacities. The market expects the company to end the current fiscal with a net profit of around Rs 35 crore.
Cauvery Software rises on preferential offer
Punters have started logginginto Cauvery Software Engineering Systems ahead of its extraordinary general meeting (EGM) on January 25. The EGM will consider the issue of equity shares on a preferential basis to a `select group of persons other than the promoters and existing shareholders'.
According to market sources, an NRI is picking up around 10 per cent stake in the company at a premium. In anticipation of the preferential allotment, the stock has already risen by 50 per cent. Earlier in December, the stock had zoomed to Rs 7.10 from less than Rs 2 on rumours of a US-based company picking up a stake in Cauvery Software. A technical correction saw the scrip falling to Rs 4. With the renewed buying in the counter, the stock has once again risen to Rs 6.20.
Titan dips on rising gold prices
The government's decision to hike customs duty on gold imports by Rs 150 has put a halt to the rally in the Titan Industries scrip. The scrip was riding piggyback the success of its jewellry division, Tanishq. However with goldbecoming dearer the company's profit margins will come under pressure. After the hike in customs duty the scrip has fallen from Rs 94 to Rs 89.65. On Wednesday, the scrip further fell to Rs 89.20.
High dividend yield in Mirza Tanners
Riding high on announcement of a 50 per cent interim dividend for 1998-99, the Mirza Tanners' scrip has touched its 52 week high of Rs 70 on Tuesday. In less than a fortnight's time the scrip has zoomed from Rs 47 level to Rs 70. On Tuesday the counter also witnessed heavy volumes to the tune of 11,600 shares. With a Rs 5 dividend per share the yield works out to be 7.5 per cent. Mirza Tanners has a good track record of rewarding its shareholders. In 1997 the company had given a 1:1 bonus. The shareholders have recently approved the CRPS issue. The proceeds from the CRPS issue will be used to finance the company's Rs 12 crore expansion-cum-modernisation plan of its Kanpur tannery, setting up of a captive power plant and a new shoe upper factory with a capacity of 4.5lakh pairs of uppers per annum at Kanpur and setting up of a new corporate office at New Delhi.
Foseco spurts on news of stake hike
With Foseco Plc UK deciding to hike its stake in Foseco India through the preferential offer route, the valuations of its Indian subsidiary have improved substantially on BSE. The scrip which had fallen after the company reported a net of Rs 56.7 lakh for the quarter ended September 30, 1998, got the much needed boost.
In seven trading sessions the scrip has moved up from Rs 161 to Rs 174. Even the volumes are high at 3,600 shares as against the daily average of 100-200 shares.
The company was originally promoted as a joint venture between Foseco Plc, Long Acre, Nachells, Birmingham, UK and Greaves Ltd. The company manufactures about 400 products for the metallurgical industry including the steel and foundry industry.
For the year ended March 31, 1998 the company reported a net profit of Rs 5.76 crore on an turnover of Rs 81.8 crore.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
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