Punters ramp up NMDC ahead of
The run-up in the share price of the NMDC counter over the past week has once again raised the bogey about valuations among investment bankers managing the company’s impending follow-on public offering. The stock hit a high of Rs 511.95 on February 10, with barely 50% of the trades resulting in delivery. This indicates that punters are ramping up the stock ahead of the FPO, and trying to get institutional investors to bid higher during the auction process.
Institutional investors are said to be showing interest in the stock only around Rs 200-220 levels. This has put the bankers to the issue in a spot, as the prevailing market price is closer to Rs 500. It seems unlikely if the government will be willing to divest stake at such a steep discount to market price.
The issue is said to have come up for discussion at a meeting between the company’s bankers and divestment ministry officials last Saturday. Government officials also debated the rationale for taking the French auction route for the NMDC issue, with some present at that meeting of the view that the methodology needs to be reviewed. NMDC shares closed flat at Rs 485 on Monday.
Traders lap up Titagarh on hopes of Budget boost
Day traders have apparently taken control of the Titagarh Wagons counter ahead of the Railway Budget on February 24. The trigger for the frenzied action in the stock, according to brokers, could be expectations of some measures that would have a positive impact on the company’s prospects.
Titagarh Wagons, one of the leading railway wagon manufacturers in the country, stands to benefit if the government announces introduction of new trains or any such proposal that would push up demand for the company’s products. The stock climbed 17% in just two trading sessions, before ending at Rs 466.6 on Monday.
The spurt in the share price took place amid a significant improvement in volumes as on a daily average basis, 25 lakh shares changed hands on Monday and last Thursday, compared to nearly one lakh shares in the previous two sessions. The interest in the counter, however, was mostly speculative as reflected in low delivery-based volumes. The delivery ratio — the percentage of shares actually delivered in the market — stood 10.7% on Monday and 6.3% on Thursday.
(Contributed by Deeptha Rajkumar & Vijay Gurav)
Src: ET
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