Date:20/02/2008 URL: http://www.thehindubusinessline.com/2008/02/20/stories/2008022052191600.htm

Back Budget hopes boost consumer durable stocks

Growth in sales adds to upward momentum

Our Bureau

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Mumbai, Feb. 19 Consumer durables companies sparkled on the bourses on the expectations of some sops in the Union Budget, stock traders said.

The BSE Consumer Durable Index gained maximum of 2.85 per cent backed by handsome gains for Titan Industries, Blue Star and Videocon Industries.

The market as a whole remained lacklustre with low volumes though stocks gained in early sessions. Sensex closed just 28 points up.

Gainers

Gainers also include Gitanjali Gems, Lloyd Electric and Engineering Ltd and Asian Star Company Ltd. “The entire sector had been on a downtrend for the past nine months in terms of month-to-month sales figures but the latest monthly data have shown positive growth and also there are some expectations from the Union Budget in terms of duty cut, which has led to upward momentum in the consumer durable stocks,” Mr S Ranganathan, Head of Research, LKP Securities Ltd, said.

Only loser in the BSE’s sectoral index for consumer durables, which has only seven scrips, was diamond and gold jewellery manufacturer and exporter Rajesh Exports. On February 13, Rajesh Exports approved the allotment of 14.78 crore-equity shares of Re 1 each of the company as bonus shares. Earlier, Rajesh Exports had split the company’s shares of Rs 2 each into two Re 1 shares from February 5, and also announced issue of 2 bonus shares for every Re 1 share held by the shareholders.

Tata group company Titan Industries topped the chart with a gain of 5.46 per cent, though the scrip still traded much below the 52-week high of Rs 1,795, it closed at Rs 1,212.90 after touching an intra-day high of Rs 1,297. Another index component jewellery manufacturer Gitanjali Gems gained 3.23 per cent to close at Rs 303.50.

Positive sentiment in Videocon Industries on account of the company’s official announcement to consider a dividend at its forthcoming board meeting on February 25 also contributed to 1.62 per cent rise in the scrip, which closed at Rs 415.

Air conditioner manufacturer Blue Star gained 2.71 per cent to close at Rs 460. Asian Star gained 0.93 per cent to close at Rs 1200.