Textile scrips dip despite sops

STOCK REPORT

The government assurance yesterday that it would launch a package to help textile exporters hit by rupee appreciation had little impact on shares of textile companies such as Gokaldas Exports, Arvind Mills, Welspun India and Bombay Dyeing.

The stocks had shown an uptrend in early trade, but the sentiment turned negative during the latter half of the trading session after analysts viewed the likely sops not to provide big relief to the export-oriented textile companies.

The Bombay Stock Exchange's 30-share Sensex ended at 14063.81, down 122.37 points, or 0.9 per cent from Thursday. Intraday it moved between 14010.61 and 14229.22 points.

The National Stock Exchange's 50-share Nifty closed at 4145.00, down 34.50 points, or 0.8 per cent. Intraday it moved between 4126.10 and 4195.15 points.

Turnover on both exchanges combined was roughly Rs 15,160 crore compared with Rs 14,300 crore on Thursday.

Analysts said the possible relief, announced by Union Textiles Minister Shankersinh Vaghela yesterday in Tirupur, a hub for several apparel and textile units in Tamil Nadu, might not help the textile companies. Further, a slowdown in the US economy might slowdown exports, hitting revenues a fresh blow, they said.

Gokaldas Exports ended the day at Rs 211.30, down 0.19 per cent. The stock has now lost nearly 4 per cent during the week. Welspun India, a leading home textile player in Asia, ended flat at Rs 67.

The stock has lost over 2 per cent during the last one month. Bombay Dyeing ended the day lower by 1.30 per cent to Rs 559.20. Arvind Mills shed 1.01 per cent to Rs 44.30. The shares have lost 3.28 per cent this week. Vardhman Textiles ended the day at Rs 185.10, down 0.51 per cent. The stock has lost nearly 4 per cent this week.

"We don't think textile companies will be benefited in a big way by the proposed sops. The slowdown in the US also may hurt exports as it is one of the main importers of Indian textiles," said a research analyst with a leading brokerage, who did not want to be quoted.

The textile minister had hinted at the possibility of taking steps to release the outstanding interest subsidy under TUFS (technological Upgradation fund scheme).