Slump may continue

STOCK MONITOR

The BSE Sensex closed 62.72 points down at 4769.99 as compared to the previous weekend close of 4832.71. Pharma major Ranbaxy, with an index weightage of 3.22 per cent, proved to be the biggest drag on the index, slumping 9.16 per cent last week.

In a generally bad week for pharma scrips, other bigwigs Dr Reddy's and Cipla also contributed significantly to the crash, as the stocks went down by 6.57 per cent and 7.72 per cent respectively. Cement majors Grasim, Gujarat Ambuja Cements and ACC also proved to be downers, crashing by 8.12 per cent, 8 per cent and 6.28 per cent respectively.

However, any further erosion in the index value was halted to a large extent by gains in power major Bhel which was the biggest gainer last week at 7.25 per cent.

Media major Zee Telefilms, too, was among the gainers, posting a 5.50 per cent gain to occupy the second spot behind Bhel. Gains in index heavyweights ONGC (1.06%), Reliance Industries (3.03%) and Infosys Technology (3.07%) also kept the index from going down further.

With sentiments at the pharma counters expected to be dull, leading scrips like Ranbaxy, Dr Reddy's and Cipla are expected to pull the markets down this week.

Stock to watch

 

TATA POWER
Last week's close (Rs)	237.07
Prev. week's close (Rs)	230.90
Week's high (Rs)	246.98
Week's low (Rs)	218.13
Last week's ave. daily turnover (Rs cr)	171.85
Prev. week's ave. daily turnover (Rs cr)	211.15
Futures close	NT
Number of up/down move	2/3

Tata Power was a bit somnolent at the bourses last week, gaining just around 2.7 per cent over its previous weekly close.

However, marketmen say the scrip may be in for some action this week. They peg their optimism on positive news flow regarding the company's ambitious Rs 6,200 crore investment plan spread out over the next five years.

The company is known to be in plans to raise $500 million in the international markets to part finance this programme. The power arm of the Tata group is planning to invest this amount in ongoing as well as new projects.

Apart from these investments, the company is also known to be evaluating new power generation projects. The bulk of the company's investments of Rs 1,628 crore may be used for the construction of a 330 mw hydro-based power project at Shrinagar in Uttaranchal.

RECAP: ORCHID CHEM
The pharma stock slipped 4.20 per cent last week before closing at Rs 190.50.

Stock of the week

 

RANBAXY
Last week's close (Rs)	908.98
Prev. week's close (Rs)	1000.95
Week's high (Rs)	1006.50
Week's low (Rs)	904.00
Last week's ave. daily turnover (Rs cr)	73.27
Prev. week's ave. daily turnover (Rs cr)	23.77
Futures close	NT
Number of up/down move	2/3

Ranbaxy tanked 9.18 per cent to close at Rs 908.78. The downsides at the counter were triggered after foreign brokerage Credit Lyonnais Securities Asia (CLSA) downgraded the stock to an underperformer on Wednesday. The recent crash came after the stock touched Rs 1,069 levels by the end of April.

In a recent report, CLSA said competition from other Indian companies in the US generics market would diminish Ranbaxy's low cost advantage there. Ranbaxy has been among the prime entrants in the US generics market.

CLSA has downgraded a host of pharma stocks that focus on the US generics market, citing increasing competition and pressure on profit margins in the generics business. The rapid commodisation of the generics market and the rising number of Indian players, which are competitively positioned, make it difficult to sustain margins, says the report.

RECAP: HERO HONDA
The scrip declined marginally by 0.40 per cent last week to close at Rs 472.60.

Mid-cap mover

 

PANTALOON RETAIL
Last week's close (Rs)	337.60
Prev. week's close (Rs)	362.85
Week's high (Rs)	368.33
Week's low (Rs)	330.13
Last week's ave. daily turnover (Rs cr)	0.75
Prev. week's ave. daily turnover (Rs cr)	7.32
Futures close	NT
Number of up/down move	0/5

Pantaloon Retail was down by 6.95 per cent to close at Rs 337.60. The leading retail chain, which owns Pantaloon, Big Bazaar and Central brands, has chalked out a Rs 150 crore expansion plan. The company plans to add 13 Big Bazaar, 17 Food Bazaar, eight Pantaloon and three Central stores across the country.

Currently, the company has 36 stores which cover 1.1 million square feet. Pantaloon Retail plans to expand its operations to 12 more cities, including Nashik, Bhubaneshwar, Durgapur, Indore, Varanasi and Lucknow, in 18 months.

It also plans to lease out additional two million square feet and reach a total leased area of 3 million square feet by December 2005 for its retail stores.

RECAP: JUBILANT ORGANOSYS
The scrip advanced 1.77 per cent to settle at Rs 554.

Small-cap mover

 

BERGER PAINTS
Last week's close (Rs)	119.00
Prev. week's close (Rs)	110.33
Week's high (Rs)	125.35
Week's low (Rs)	102.55
Last week's ave. daily turnover (Rs cr)	0.21
Prev. week's ave. daily turnover (Rs cr)	0.06
Futures close	NT
Number of up/down move	2/3

Berger Paints had a good run at the bourses last week, ending over 7.8 per cent higher than its previous weekly close. The scrip has been enjoying a good run since it declared handsome results in the latter half of the week.

For the year ending March 31, 2004, the company had recorded a 32 per cent growth in net profit to Rs 44.22 crore compared with Rs 33.65 crore in the previous year.

It has recommended a final dividend of 30 per cent on the expanded share capital post-bonus, having already paid an interim dividend of 35 per cent.

This translates into 80 per cent pay out on the pre-bonus capital as compared to 60 per cent in the previous year. The company's consolidated gross sales stood at Rs 814 crore.

RECAP: MONNET ISPAT
The Monnet Ispat stock crashed 6.65 per cent last week to close at Rs 68.75.