Paramount Communications marches on stock-split agenda

Paramount Communications marches on stock-split agenda. Paramount Communications surged 2.72% to Rs 221.10, after the company board decided to meet on 20 October 2006, to consider a stock-split proposal along with Q2 results. As many as 4.23 lakh shares were traded on the BSE.

The stock has been quite volatile. It has moved between Rs 117 and Rs 293 since late-March 2006. After a sharp surge to Rs 192.65 on 25 August, from a low of Rs 116.85 on 24 July, it plunged to Rs 165.50 by 31 August 2006. Here, the stock rose to Rs 232.15 on 21 September, only to slip to Rs 215.25 by 13 October 2006.

The current price of Rs 221.10 discounts its trailing 12-month June 2006 EPS of Rs 17, by a PE multiple of 13.

Recently, Paramount Communications plans to raise $50 million through various securities. The board has also decided to increase authorized capital from Rs 25 crore to Rs 35 crore.

The company had earlier completed a $ 15 million GDR issue. It was priced at Rs 197.75 per share. With the successful closure of GDR for $ 15 million, the company is executing its expansion project for manufacturing high tension and low tension power cables at a faster pace.

Paramount Communication provides cabling solution to power, telecom and IT, Railways, petrochemical and other industries. The company has a flexible manufacturing capacity, which enables it to shift focus on manufacturing one type of cable to another, depending on the prevailing demand for the product.

The company reported 126% growth in net profit to Rs 5.01 crore, on 50% growth in sales to Rs 34.75 crore for Q1 June 2006. The company was able to procure copper at very low prices based on advance bookings, which led to the strong growth in bottomline during the same period.

Finolex Industries upbeat on sterling Q2 figures

Finolex Industries surged 2.83% to Rs 98.15, after its net profit rose 108.9% for Q2 September 2006. The counter clocked 1.46 lakh shares on the BSE. The stock witnessed a solid rally in the past few trading sessions. >From Rs 80.15 on 31 August 2006, the stock surged 15.16% to Rs 98.55 by 25 September 2006, as buying continued on heavy volume. Thereafter, the stock remained range-bound, between Rs 92 and Rs 97. The stock closed at Rs 95.45 on 13 October 2006.

At the current price of Rs 98.15, Finolex Industries trades at 31.86 times its Q1 June 2006 annualised EPS of Rs 3.08.

Finolex Industries has reported a net profit growth of 108.9% to Rs 19.99 crore for Q2 September 2006, compared to Rs 9.57 crore in Q2 September 2005. Net sales during the same period has risen 11.3%, to Rs 196.12 crore from Rs 176.21 crore.

The company expects global demand for PVC resin to grow at around 3.5% per annum. Demand in India is expected to show double digit growth in the current year.

In the PVC pipes segment, the company expects significant growth in coming years due to government initiatives at central and state levels.

In April, the company had set up a coal-based 22 Mw captive power plant for its PVC unit at Ratnagiri. The plant will become operational by September 2007.

Finolex manufactures PVC resins and PVC pipes.

To meet rising demand, the company has proposed to expand PVC resin capacity from 1.30 lakh tonnes to 2.60 lakh tonnes. It also plans to increase the PVC pipe capacity further.

Praj Industries climbs on eye-popping Q2 results

Praj Industries rose 3.27% to Rs 205.30, after reporting a 275.50% surge in net profit for Q2 September 2006. The counter clocked 4.92 lakh shares on BSE.

The stock witnessed a solid spurt ahead of results. From Rs 161.40 on 4 October 2006, it surged to Rs 198.80 by 13 October 2006, on expectations of a robust set of results from the company.

Praj Industries reported 275.50% surge in net profit to Rs 17.49 crore for Q2 September 2006, compared to a net profit of Rs 4.66 crore in Q2 September 2005. Net sales jumped 156.60%, to Rs 147.67 crore (Rs 57.53 crore).

Recently, Praj Industries acquired US-based C.J. Schneider Engineering Co (CJS) for Rs 22.50 crore. CJS provides engineering services to the biofuel industry, including for ethanol plants. CJS already has contracts on hand from leading ethanol producers.

The company's investment programme of Rs 100 crore will be entirely through internal accruals. A couple of months ago, Praj Industries raised Rs 117 crore through a preferential allotment of shares and warrants to Japanese conglomerate Marubeni Corporation, Vinod Khosla, world renowned IT entrepreneur and Silicon Valley venture capitalist, and others.

Pune-based Praj Industries is a global leader in alcohol and ethanol plants. Praj Industries also supplies technology and equipment to wheat and corn-based plants.

The company has been stressing on R&D. It wants to focus on research in biofuels, and the latest technologies involved in production of alternative biofuels other than ethanol.

As on 30 June 2006, FIIs hold 5.3% stake, whereas institutional holding was 6.7%. The public and promoters holding was 43.79% and 30.31% respectively.