Sad Song At Philips

Price on 4/9/97: 65.75

Price on 29/8/97: 78.5

The scrip has declined by 16.24 per cent over the last week due to the poor first half results. The company went into the red and even sales declined by 3 per cent to Rs 679.57 crore. Operating margin also dropped by 2 per cent over the corresponding period. The decline in sales is attributed to the stiff competition faced by the company in the consumer electronics market.

The lighting division, which is the main contributor, also saw a decline in sales. The restructuring costs have also eaten into the companys profits. The results of the restructuring exercise are eagerly awaited by the company and it expects this to have a positive impact on the bottom line.

 

Software Solutions

Price on 4/9/97: 142.25

Price on 29/8/97: Rs 15.25

This scrip has appreciated about 25 per cent over the last weeks closing price and this is mainly attributed to the companys positive results. The net profit has gone up by 27 per cent to Rs 6.18 crore and the income from operations has gone up by 72 per cent to Rs 23.15 crore.

The company has proposed a dividend of 30 per cent. The rise in the stock can also be partly attributed to the boom in software industry stocks. The company has plans of expanding in a greater way in the southern region and will start 15 more education centres in south and later on expanding to north also.

Sterlite

Price on 4/9/97: Rs 189.75

Price on 29/8/97: Rs 239.25

This scrip has depreciated by around 21 per cent over the previous week due to the explosion at the companys factory in Tuticorin. The Tamil Nadu state government has also passed an order to close down the furnace operations till all the safety requirements are met by the company.

The stock price has been on a downward trend over the past couple of months after the poison gas leakage incident in the vicinity of the factory which forced the state government to close down the factory for a couple of weeks.

The recent state government order asking the company to stop using the smelter furnace till it meets the safety standards has come at a time when the anti-Sterlite forces are gaining momentum in their campaign.

Gas Authority of India

Price on 4/9/97: Rs 157.75

Price on 29/8/97: Rs 140.25

This scrip has gone up by 12.5 per cent during the last week because of the petroleum products hike and the imminent GDR issue. The recent increase in the price of liquefied petroleum gas (LPG) by the government will improve the companys earnings. GAIL is Indias premier gas processing, transmission and distribution company. It supplies almost 17 bscm of gas over its 3,500 kms of pipelines. The governments decision to bring policy guideline to dismantle the APM for LPG will definitely benefit the company after the free pricing. The road show for the companys GDR issue is on at present. The stock price is expected to remain firm till the GDR issue at least.