Stocks in the news

The stock price of Forbes Gokak has been moving sharply as the market is valuing its 100 per cent subsidiaries and expected value unlocking. The shares of the 200 year old company of Shapoorji Pallonji group gained 57.5 per cent last week to close at Rs 995.05 compared with the previous week's close of Rs 795.90 on account of valuations reports issued by brokerage houses. The reports suggest that the company is undergoing a restructuring and is grossly undervalued.

Forbes Gokak owns 100 per cent of Eureka Forbes, which has reported turnover of Rs 740 crore and net profit of Rs 24.91 crore in the year ended March 2007.

The stocks in water treatment space are now being given higher price earnings multiple as markets have taken a fancy to them.

Ion Exchange, which is in a similar space, is valued at a P/E of 55. With an EPS of Rs 26 on a consolidated balance sheet, Eureka Forbes is worth Rs 1,430. The company has set up container freight stations in Veshvi and Mundra and the gains will start flowing this year.

Speciality: Bonus buzz
The stock of Speciality Papers gained by 27 per cent from Rs 72.25 to Rs 92.05 in the last week. The company's proposal of maiden bonus issue triggered a rise in the stock price. The board meeting, due on January 5, would declare a maiden bonus issue and decide on raising equity through preferential issue of shares.

The Reliable group company is a leading manufacturer and exporter of speciality grade papers and is also engaged in marketing various types of paper and paper products. It offers the complete line of paper and paper products for home, office, industrial and packaging requirements.

The company had reported 268 per cent jump in net profit to Rs 3.61 crore (Rs 98 lakh) in FY 2006-07. It has posted 25 per cent rise in net profit to Rs 76 lakh in the first half of current fiscal 2007-08. The stock is trading at a price multiple of 8.93 on a trailing twelve months EPS of Rs 9.82 on the BSE.