Last weeks close: Rs 26.25
Previous weeks close: Rs 23.05
The Hindustan Oil Exploration Company (HOEC) scrip has gained an impressive 13.88 per cent to close at Rs 27. The company has been successful in striking oil in the PY-3 field and production is expected to begin in mid 1997. With estimated reserves of 25 million barrels, the find has been extremely beneficial.
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The company also stands to benefit from a 5 year tax holiday announced for oil exploration companies alongwith tax rebates for potential investors in the 1997-98 Budget. This will facilitate the company to procure funds from the financial markets.
To obtain funds and technology for further exploration, the company has been successful in roping in Hardy Oil UK, which has agreed to pick up 50 per cent of the preferential issue of Rs 33.75 crore, the rest being subscribed by HDFC and IL&FS. The company also plans to develop other oil fields in its portfolio which have vast potential as per preliminary surveys.
Schlafhorst Engineering
Last week's close: Rs 30.75
Previous week's close: Rs 24.75
The scrip recorded a gain of 24.24 per cent over the previous week and closed at Rs 29.25. Volumes in the scrip which had been meagre, witnessed an upsurge on March 6, 1997 to 394,233 shares on the BSE, but again dropped down to a few hundred shares.
This spike in volumes seems to have helped the share price climb from Rs 13 to its present high. This sudden level of interest can be attributed to the encouraging half-year results declared by the company. The company declared an operating profit of Rs 3.45 crore on sales of Rs 52.18 crore as compared to an operating loss of Rs 3.22 crore on sales of Rs 37.2 crore in the previous year. The company looks poised for a turnaround.
ITW Signode
Last weeks close: Rs 113.5
Previous weeks close: Rs 92.2
Buoyed by the recent announcement of the $5 billion ITW Inc, USA to raise its stake in its Indian counterpart ITW Signode, from 29.25 per cent to 51 per cent, the scrip reacted sharply to gain 23.04 per cent and close at Rs 113.5. The infusion of equity will boost the capital to Rs 22.87 crore from the present level of Rs 15.84 crore. The performance of the company for the year ended December 1996 has also been commendable, with a rise in sales to Rs 166 crore from Rs 130 crore. Net profit was Rs 5.14 crore, up from Rs 4.8 crore in the previous year. The increased participation of the parent company will provide ITW access to the latest technology and newer product lines.
SOL Pharma
Last weeks close: Rs 42
Previous weeks close: Rs 51
This scrip lost 18.84 per cent. The pharma sector scrips, especially bulk drug manufacturers have not had it easy at the bourses. The step motherly treatment meted out to them by the excise authorities is said to be the cause of the current price slide.
The excise notification number 6, of 1997, which allows the Modvat credit, accumulated on bulk drugs till March 1,1997 to lapse has hit SOL Pharmaceuticals.
Though the budget has brought excise duty on raw material and drug intermediates in line with bulk drugs , the Modvat notification has nullified this effect. This puts bulk drug manufacturers in a quandary.
To add to its woes, the reduction in import duties on bulk drugs proposed by the Budget will lead to large scale dumping by Chinese and other manufacturers further eroding its margins, say industry sources.The outlook for most bulk drug manufacturers looks bleak.
IPCA Labs
Last weeks close: Rs 102.75
Previous weeks close: Rs 116.25
This scrip lost 11.62 per cent over last week. IPCA has been in the news recently, with the Bach chans planning to sell off their stake of 36 per cent, at a premium of 25-30 per cent over the price of Rs 120. This move seems to have encountered rough weather as the scrip has lost 12.9 per cent to close at Rs 101.25.
IPCA too has been affected by the withdrawal of Modvat credit accumulated on bulk drugs till March 1, 1997, vide the notification referred to earlier.