The share price of O P Jindal group company, Saw Pipes Ltd, rose to Rs 169.85 today on the Bombay Stock Exchange (BSE), from Rs 53.7 on April 12, 2001. The climb represents a 216 per cent jump in less than a month-and-a-half.
During the period, the 30-share Sensex moved from 3183.77 on 12 April to 3674.54 today - an increase of 15.41 per cent.
The volumes traded on the stock exchange too posted an increase during the period - from 202,605 shares on April 12 to 468,730 today. In April, except on three out of 15 trading days, the daily volumes were below 250,000 shares. So far during this month, all 15 trading days have recorded volumes in excess of 250,000 on the BSE.
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Saw Pipes vice-president (finance) Abhay Bhargava said: "It's probably the market sentiment. There is a change in the scenario in the energy sector and, therefore, the price has suddenly gone up. Worldwide, there is an upsurge in the energy segment. Even in India, amongst all the old economy stocks, it's the energy sector that is doing the best."
Meanwhile, Securities & Exchange Board of India (Sebi) chairman D R Mehta, when asked if the market regulator was looking at the spurt in the Saw Pipes share price, declined to comment. Saw Pipes executives said they have not received any communication from Sebi on the matter.
The Saw Pipes share price had touched Rs 239.95 on February 8, 2001, and then it fell consistently to Rs 53.7 on April 12, only to rally again. The daily trading volumes were invariably over a million on the stock exchange during February.
Marketmen said the spurt could be attributed to the positive business outlook of the company. "Some 6-8 months back, the share price was Rs 20 or so and then it increased to Rs 220-240. The results of the company did not reflect such a bullish sentiment. They have got big orders, all right," says Delhi-based stock broker Sudhir Joshi.
Saw Pipes was targeting a turnover of Rs 500 crore during 2000-01 as against Rs 285 crore for 1999-2001. Company officials had told Business Standard some time back that it has set a turnover target of Rs 1,000 crore for 2002-03 riding high on orders for transmission pipes from the oil and gas sector. The official had also said that the company hopes to be debt-free by that year.
The company, at its board meet on April 25, had adopted the results for its third quarter ended March 31, 2001, which showed a 35 per cent jump in turnover to Rs 142 crore as compared to the same quarter of the previous year. Saw Pipes also reported a 53.76 per cent jump in net profit from Rs 4.65 crore to Rs 7.15 crore during the period. Between the two quarters, its basic EPS improved from Rs 0.76 to Rs 1.36.