HDFC MF hikes stake in TNPL to 8%

Two schemes under the management of HDFC Mutual Fund (HDFC MF) have increased stakes in Chennai-based Tamil Nadu Newsprint and Papers (TNPL) to a tad lower than 8%. The funds had mopped up TNPL shares from the open market, both TNPL and HDFC said in separate filings with regulators.

However, the price at which HDFC funds had bought the TNPL shares is not immediately known. The two funds which lapped up additional stake in TNPL are HDFC Trustee Company and HDFC Monthly Income Plan. ?In accordance with regulations and other applicable laws or regulations, we wish to inform you (that) there has been an increase of 2.49% in the holdings of the scheme of the HDFC Mutual Fund in the company. The aggregate holdings of the schemes of the HDFC Mutual Fund in the company was 7.846% of the paid up equity share capital of the company,? HDFC said in its regulatory filings.

While HDFC Trustee Company had picked up 1.442% stake in the company from the open market, HDFC Monthly Income Plan had bought another 1.048% stake in TNPL in separate deals, taking their total holdings to close to 8%. The schemes together were holding 5.36% stake in TNPL as of September last.

Incorporated in early 1980s, TNPL is one of the largest manufacturers of bagasse-based newsprint, printing and writing paper materials. The state government is the only promoter of the company with a 35.32% stake as of the quarter ended December 2010. LIC is the second largest shareholder in the state-run paper maker with close to 10% stake.

The company had recently enhanced its installed capacity to four lakh tonnes per annum, up from 2.45 lakh tonnes as part of its mill expansion plan. TNPL exports one fifth of its production to over 30 countries.

As of the quarter ended December 31, 2010, TNPL had clocked a net sales of Rs 267.54 crore and recorded a net profit of Rs 36.45 crore.

The Rs 10 face value stock is currently trading at Rs 125 levels and on Tuesday, the scrip closed on NSE at Rs 124.95, down by 0.87%. The stock had a yearly high of Rs 166 and a yearly low of Rs 80.25.