Uttam Galva Steels spurts on reports Posco Korea signs MoA with group firm

Uttam Galva Steels rose 8.98% to Rs 41.25 at 14:07 IST on BSE on reports South Korea's Posco signed an agreement with Shree Uttam Steel and Power to set up a steel factory at Satarda in Maharashtra.

Meanwhile, the BSE Sensex was down 221.81 points, or 0.79%, to 27,879.91.

On BSE, so far 5 lakh shares were traded in the counter, compared with an average volume of 58,006 shares in the past one quarter.

Trading on the counter was volatile. The stock rose 17.31% at the day's high of Rs 44.40 so far during the day. The stock fell 0.13% at the day's low of Rs 37.80 so far during the day.

The stock hit a 52-week high of Rs 85.50 on 17 September 2014. The stock hit a 52-week low of Rs 31.45 on 16 June 2015.

The stock had outperformed the market over the past one month till 10 August 2015, rising 2.44% compared with 1.59% rise in the Sensex. The scrip had, however, underperformed the market in past one quarter, sliding 19.64% as against Sensex's 3.68% rise.

The small-cap company has an equity capital of Rs 142.26 crore. Face value per share is Rs 10.

According to reports, steel maker Posco Korea signed a joint venture agreement with the Uttam Galva group to set up a three-million-tonne steel plant in Maharashtra. The agreement was signed in Mumbai today, 11 August 2015, morning, reports added.

Shree Uttam Steel and Power is part of the Uttam Galva group promoted by the Miglani family. As on 30 June 2015, Indian promoters held 31.82% stake, while Arcelormittal Netherlands BV held 29.05% stake in Uttam Galva Steels.

With reference to the news captioned, "Uttam Galva, Posco JV to Set up 3mln tons / yr steel plant", Uttam Galva Steels clarified during trading hours today, 11 August 2015, that it had not signed any joint venture agreement with Posco, Korea. However, a Memorandum of Agreement (MoA) was signed between Posco, Korea and Shree Uttam Steel and Power, one of the companies owned by Miglani family, to explore the possibility of joint venture arrangement between the two firms.

Net profit of Uttam Galva Steels declined 80.52% to Rs 1.86 crore on 5.86% rise in net sales to Rs 1708.71 crore in Q1 June 2015 over Q1 June 2014.

Uttam Galva Steels is one of the largest manufacturers of cold rolled steel ("CR") and galvanized steel (GP) in Western India. The company is into the business of procuring hot rolled steel ("HR") and processing it into CR and further into GP and Colour Coated Coils.

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