JP Associates gains on buzz of likely sale of cement plants

Meanwhile, the BSE Sensex was down 110.18 points, or 0.57%, to 19,059.65.

On BSE, 18.39 lakh shares were traded in the counter as against an average daily volume of 20.53 lakh shares in the past one quarter.

The stock hit a high of Rs 80.30 and a low of Rs 77.25 so far during the day. The stock had hit a 52-week high of Rs 106.75 on 12 December 2012. The stock had hit a 52-week low of Rs 58.05 on 24 May 2012.

The stock had outperformed the market over the past one month till 22 April 2013, rising 21.45% compared with the Sensex's 2.32% rise. The scrip had, however, underperformed the market in past one quarter, sliding 14.59% as against Sensex's 4.06% fall.

The large-cap infrastructure company has equity capital of Rs 443.81 crore. Face value per share is Rs 2.

The media report suggested that the enterprise value of Rs 4100 crore includes debt of Rs 1800 crore. The deal between UltraTech Cement and the cement unit of Jaiprakash Associates is reportedly expected to be completed before May 2013.

The sale of the unit is aimed at reducing Jaiprakash Associates' debt by Rs 8000 crore. The group has a debt of Rs 45000 crore as at the end of December 2012, report added.

Jaiprakash Associates, apart from selling cement unit to UltraTech Cement, will soon reportedly raise Rs 1000 crore by selling parcels of real estate owned by its subsidiary Jaiprakash Infratech.

Report said that the purchase of the cement plant will catapult Aditya Birla group to India's largest cement maker by controlling 20% of the India's cement market, overtaking multinational Holcim with 57 million tonnes capacity.

Ireland-based building materials group CRH Plc announced on 9 October 2012, that it had terminated talks to buy cement plants from a unit of Jaiprakash Associates.

On 7 August 2012, CRH plc had announced of entering into negotiations with Jaypee Cement Corporation (Jaypee) regarding the possible purchase by CRH of an equity stake in Jaypee's Gujarat cement business. These negotiations were, however, terminated later as the parties were unable to agree terms.

Jaiprakash Associates' net profit declined 64.2% to Rs 110.93 crore on 15.3% growth in net sales to Rs 3398.39 crore in Q3 December 2012 over Q3 December 2011.

Jaiprakash Associates is a diversified company with business interest in construction, power, cement, real estate and hospitality.

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