Paramount Comm, Sanghi Ind are stocks in news

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Paramount Comm, Sanghi Ind are stocks in news

Paramount Communications had reached a high in July and then in July-August, it has corrected by 30%. Sanghi Industries, the stock has corrected 20% from its high some time in July.

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Excerpts from Midcap Radar on CNBC-TV18 Watch the full show » RELATED NEWS Paramount Comm to acquire UK-based cable co: Srcs ALSO READ See what other experts are saying about markets See what FIIs are saying about the markets See what Udayan Mukherjee is saying about the markets BSE | NSE 01/01/70 Are Mutual Funds betting on ? Other Stocks in this news Paramount Communications | Sanghi Industries |

Paramount Communications had reached a high in July and then in July-August, it has corrected by 30%. The stock bottomed out by Rs 25 and once again has seen some kind of upward trend.

The company manufactures power and telecom tables and the Q1 results were exceptional. The topline grew by 150%, the bottomline grew by 60%. So, exceptional results came in the first quarter. Most of the growth came in from power cables, especially from the Indian Railways. The company has gone ahead and said in their analysts' meet that the Indian Railways will provide a significant boost in FY08. In fact they have gone ahead and said that they are expecting revenues by Rs 150 crore from the Indian Railways. If you put into the perspective, this is about 45% of the FY07 revenues.

Now, the company is working with full capacity and also new capacities are coming up. In fact, the company is in the midst of an expansion. The first phase has been completed, the second phase of the expansion will be completed in September 07 and the third phase will be completed a year later in September 08. A few important things - the company has placed a bid with BSNL and is awaiting an allocation from BSNL . The business could be worth around Rs 80 crore. Apart from that the company has an order backlog as on August 1 about Rs 130 crore.

Apart from that, there is also media report floating around that the company is looking for an UK acquisition - a cable company. The deal size could be around USD 50 million. So few things are happening within the company. In the short-term, we should be looking for some orders coming in from BSNL.

Moving on to Sanghi Industries , the stock has corrected 20% from its high some time in July. But since then also it has bottomed by Rs 65 and since then it has reached a new high of Rs 95 breaching its earlier high of Rs 81. The company manufactures cement; it has its main hub around Gujarat where it has the market share of about 15% and Kutch where it is market leader of about 49% market share. The company had pretty non-exceptional quarter in Q1, just about 5% growth in topline and bottomline. It has a three million tonnes capacity in cement and it's looking to expanding its capacity pretty aggressively to about 8 million tones.

Of course, we need to look out for some kind of land news on this. There have been news that Sanghi Group has about 2,000 acres of surplus land but investors need to be very careful with this because we don't know how much of it actually belongs to its listed entities Sanghi Industries.