Huge volumes on India Cements raise eyebrows

Anindita Dey

Mumbai, July 17: About 75 lakh shares have changed hands at the India Cements counter over the last seven days both at the National Stock Exchange (NSE) and at the Bombay Stock Exchange (BSE).

According to market sources, this appears to be a block deal as no significant price movement happened. To be precise, while the average number of shares traded was in the range of 25,000 - 83,000 between July 2 to July 9 on the BSE, the volumes went up to almost nine lakh shares on July 10, followed by seven lakh shares on July 13 and three lakh shares on July 14.

On the other hand, on the NSE, while the volumes remained volatile ranging from 1.68 lakh on July 2 to over 30,000 shares on July 9, before zooming to 25.73 lakh on July 10 followed by 10.04 lakh on July 13 and 15.44 lakh on July 14. The volumes on July 11 and July 12 again came down at average levels in the range of 50,000-70,000 on the BSE and 97,000-1.59 lakh on the NSE. However on both the counters, the price change was not significant, hovering in the range of Rs 32.25 and Rs 34.60 for the entire period of transaction of almost 75 lakhs share, thus indicating these trades as block deals, said market sources.

India Cements officials, when contacted, said they were not aware of such a development. However, they added that if at all deals have happened, it is nothing substantial as the promoters are comfortable with their stake. Market sources, on the other hand, said these block deals have been entered into as inter-institutional trade by the promoter with foreign institutional investors on behalf of foreign cement majors.

Another section of the market believes that these heavy volumes have been traded to bring down the forward position before September 2001. However, those advocating block deals are of the view that there has been no major change in the forward postion at both the counters.

While on the BSE, the forward positions at the counter came down from 32.10 lakh shares worth Rs 10.29 crore on July 3 to 12.49 lakh shares worth Rs 4.31 crore on July 17, the outstanding position on the NSE has risen from 9.71 lakh shares worth Rs 3.06 crore to 18.87 lakh share, amounting to 6.52 crore for the same period.

India Cements is the only major cement company whose market capitalisation over a one month period from June to July has come down by 6.4 per cent. For ACC, the market capitalisation went up by 11 per cent followed by Madras Cements by 2.3 per cent and Gujarat Ambuja by 1.2 per cent, analysts added.