Bata On A Strong Footing

Bata India

Price as on 31/07/1998 Rs 222.70

Price as on 24/07/1998 Rs194.80

Bata India's share prices gained 14.32 per cent in the previous week. This can be attributed its performance for six months ended June 1998. Its net profit rose by 153.36 per cent to Rs 18.09 crore against Rs 7.14 crore last year. Net sales grew by 11 per cent to Rs 378.60 crore Gross profit margins improved from 4.2 per cent in 1997 to 8.5 per cent. The company has cut its interest cost substanially from Rs 8.21 crore to Rs 3.96 crore. This was on account of reductions in borrowings

 

Hike in excise duty on footwear, especially in lower price ranges announced in the latest budget will increase the company's manufacturing costs. The company has continued its marketing focus on the low to medium price ranges, as also with its policy to upgrade retail showrooms.

The company's export oriented unit at Hosur, Karnataka has been under lockout from April 2, 1998 due to unaccepatble actions taken by the union. It has initiated a long term agreement in the company's manufacturing units in Mokamehghat, Bangalore and Faridabad.

IPCL

Price as on 31/07/1998 Rs 47.05

Price as on 24/07/1998 Rs 50.60

IPCL, the number two petrochemical major, dropped by 7.03 per cent last week on its dismal performance The company declared a net loss of Rs 57 crore for the first quarter of 1998-99. This was due to falling petrochemical prices and shut down of its Nagothane plant. Petrochemical prices were at an all time low and the global prices remained highly volatile resulting in a squeeze in margins. However, the net sales rose to Rs 584 crore from Rs 552 crore during the same period. Its volumes rose 28 per cent to 2.09 lakh tonnes of products. Interest was at Rs 64.81 crore and other income stood Rs 13.30 crore. IPCL is increasing its ethylene capacity to 8.3 lakh tonnes by the year end which will lead to capacity increase in end products to the extent of 3.5 lakh tonnes.

To combat the current down cycle, the company is strengthening its production capacities, infrastructure and the supply chain management. In thethe first quarter, the company had imported feed stock worth 66000 tonnes as compared to 15000 tonnes in the previous period.

Cynamid Agro

Price as on 31/07/1998 Rs 288.60

Price as on 24/07/1998 Rs 254.30

Cynamid Agro gained 13.49 per cent in the previous week. This scrip was listed on BSE on July 20, 1998, after Cynamid Agro shares were allotted to the shareholders of Cynamid India following the merger of the latter with Wyeth Laboratories. Initially, the scrip witnessed selling pressure and its price plummeted from a high of Rs 240 to a close of Rs 219. However, as the company announced its last full year results, the stock move on the higher end of the circuit breaker on all trading sessions.

Cynamid Agro commenced operations only from January 1, 1998 and in the three months it posted a net profit of Rs 8.14 crore. Net sales for the company stood at Rs 102.01 crore and other income stood at Rs 3.44 crore. The net worth of the company stood at Rs 43.16 crore.

Raymond

Price as on 31/07/1998 Rs 54.60

Price as on 24/07/1998 Rs 60.65

Raymonds scrip lost 13.49 per cent last week as the company put up a dismal performance for the first quarter of 1998-99. It has incurred a loss of Rs 13 crore as against Rs 11 crore during the corresponding period of the previous year. It has recorded a turnover of Rs 231 crore, a drop of 6 per cent over the Rs 247 crore it had achieved last year.

In the first quarter the company has not been able to show the kind of growth it achieved last year as demand for textile largely picks off in the second half. While its cement and steel divisions continue to be affected.

As a part of its restructuring exercise Raymonds had decided to transfer its steel division to a joint venture with the Thyssen Krupp Steel group of Germany. This venture has, however, been now called off following festering differences between the two joint venture partners.