India Glycols gets a Prudent push

STREET SIGNS

The bulls have been waiting in anticipation for some time for the Sensex to climb over 8000. But the jinx continued as they were thwarted again. The blame was squarely placed on the government's decision to hike fuel prices.

However, the optimists far outnumber the pessimists at the street and are betting for the index to take the final few steps before the week is over.

Right chemistry
Prudent Fund has taken a liking to the chemicals stock India Glycols, as evidenced by its purchases at the counter. The stock has been on a vertical climb in the past few weeks and has seen a 79 per cent appreciation in the past month alone to Rs 259.

Apparently, what has caught the attention of Prudent is the fact that molasses prices has been falling. To make the connection apparent, India Glycols makes mono-ethylene glycol (MEG), for which it uses molasses as raw material.

According to pundits, molasses prices have fallen by more than 25 per cent in the last month and a further fall is expected. Also Prudent feels that the stock valuation at 9x is very low, compared with its growth potential.

Going soft
Those who have been wondering about the reason behind the rise in stock price of Four Soft got their answers. Close on the heels of many domestic and foreign fund purchases at the counter, came news that the company has signed an agreement to acquire the logistics software business of UK-based DCS Transportation for $19 million (over Rs 85 crore) in an all-cash deal. Apparently, this would make Four Soft the world's largest transportation and logistics software product company.

The buying at the counter had taken the stock price from Rs 45 levels a month back to above Rs 100. Phoenix fund was among the many who had bought the stock in anticipation of the deal. The buyers were quick to book profits too, which led to the stock tumbling down yesterday.

However, domestic operators who have been late to wake up, were back at the counter on Tuesday, resulting in a 2.5 per cent rise in stock price.

In other news...
The Amtek India stock has witnessed a sustained rise over the past few months. The buzz has been that the company could get merged with Amtek Auto. Pundits have been noting that any such merger is sure to enhance the share value of Amtek India.

However, some are already in the mood to book profits at the counter. Uncle Sam for example has decided to book profits at the counter at Rs 502 levels. Considering the fact that the stock has gained more than 90 per cent in the past four months, that seems to be a wise decision.