Below-par counters are on a hot streak

Strong financials for the quarter ended Sept 2004 helped the companies post 65% value growth

Stocks trading below their paid-up values have outperformed others in the last four months. The aggregate market value of over 900 such stocks appreciated by 65 per cent in the period "" from Rs 10,503 crore on June 30 2004 to Rs 17,315 crore on November 10, 2004.

During the period, the Bombay Stock Exchange Sensex and the National Stock Exchange S&P CNX Nifty gained by 25 per cent each. The Sensex moved up from 4795.46 to 5973.75 while the S&P CNX Nifty rose from 1505.60 to 1876.10 in the past four months.

Hectic buying by investors in small stocks has seen as many as 288 of the 952 stocks that traded below their paid up values four months back quoting at a premium now. Of the 288 scrips, 165 have more than doubled their prices in the last four months.

Strong financial results for the quarter ended September 2004 helped these companies post better value growths. The aggregate net loss of 381 companies (quarterly results of which are available) has declined to Rs 93 crore in the quarter ended September 2004 from Rs 518 crore in corresponding quarter of the previous year.

Of these, 54 went into the black and 71 posted an over 50 per cent growth in bottomlines during the quarter. The stocks that surged are from varied sectors "" auto ancillaries, castings, cement, information technology, electronics, pharmaceuticals, steel and textiles. 
 

How they fared Top gainers among below-par stocks
	Closing price in Rs on BSE			Net Profit/Loss(Rs lakh)
	June 30	Nov 10	%Chg	Q2 '03	Q2 '04
Hester Pharma	8.21	67.34	720.22	38	127
Venus Remedies	9.61	78.15	713.22	32	86
Modern Steels	8.75	68.2	679.43	-1	266
Noble Explochem	5.55	35.35	536.94	-57	76
Lloyds Metals	4.36	26.35	504.36	-275	511
Bilpower	6.60	34.50	422.73	38	140
Fairfield Atlas	8.35	40.65	386.83	-203	143
Softpro Systems	9.65	45.60	372.54	-17	37
Jaipur Polyspin	5.22	23.11	342.72	-4	10

The biggest gainer has been Hester Pharma which surged 720 per cent to Rs 67.34 on November 10, 2004 from Rs 8.21 on June 30, 2004. The company posted a 234 per cent rise in net profit to Rs 1.27 crore in the September quarter from Rs 38 lakh in previous corresponding quarter.

The scrip of Modern Steel, which turned into the black with a profit of Rs 2.66 crore in the September quarter, appreciated by 679 per cent to Rs 68.20 (Rs 8.75). Similarly, Lloyds Metals' price increased by almost six-fold to Rs 26.35 (Rs 4.36). The company posted a net profit of Rs 5.11 crore against a net loss of Rs 2.75 crore.

Other companies that turned into the black and appreciated by more than 100 per cent include Noble Explochem (by 537 per cent to Rs 35.35 from Rs 5.55), Fairfield Atlas (by 387 per cent to Rs 40.65 from Rs 8.35), Softpro Systems (by 372 per cent to Rs 45.60 from Rs 9.65), Jaipur Polyspin (by 343 per cent to Rs 23.11 from Rs 5.22), Simplex Mills (by 321 per cent to Rs 38 from Rs 9.02) and Eskay K'n'it (by 307 per cent to Rs 13.32 from Rs 3.27).

Among the companies that posted a more than 100 per cent jumped in net profit during the September quarter are Venus Remedies (scrip rose 713 per cent to Rs 78.15 from Rs 9.61) and Bilpower (up 422 per cent to Rs 34.50 from Rs 6.60), Ahlcon Parenterals (up 377 per cent to Rs 24.10 from Rs 5.05), Ricoh India (up 286 per cent to Rs 24.55 from Rs 6.36) and Panama Petrochem (up 251 per cent to Rs 33.90 from Rs 9.66).