Nifty extends gain; paper stocks surge on AP Paper deal

Indian equity benchmarks were unstoppable in their uptrend as they have been rallying for the seventh consecutive session today, tracking positive global cues and especially stabilising crude oil prices around USD 114-115 a barrel.

TCS, Dr Reddy's Labs, Sun Pharma, Ranbaxy Labs, Sesa Goa, M&M, Maruti, Bajaj Auto, BHEL, ONGC, ICICI Bank, HDFC, Reliance Industries, Infosys, L&T, Jaiprakash Associates, HUL and ITC were pushing the markets higher.

However, Bharti Airtel and BPCL were losers in trade.

At 9:18 hours IST, the 30-share BSE Sensex was trading at 19,247, up 126 points and the 50-share NSE Nifty gained 36 points at 5,772.

The Nifty March futures were trading at 14 points premium ahead of expiry on Thursday and April futures were at 43 points premium.

Given most of the bad news such as high inflation, fiscal worries, higher oil prices and negative earnings momentum seem factored in, Suresh Mahadevan of UBS believes it is time to look at midcap names. "The BSE Mid & Small Cap Indices have underperformed Sensex by 19.5% and 13.4% since November."

The CNX Midcap rallied 57 points at 7,959. About 1135 shares advanced as against 311 shares declined on the Bombay Stock Exchange.

New Listing - PTC India Financial Services was trading at Rs 25.2, down 10% from issue price of Rs 28 a share.

Midcap & Smallcap space:

Paper stocks were in limelight after AP Paper Mills deal with International Paper.

US based International Paper is going to acquire 53.5% stake in AP Paper Mills for USD 257 million + 21.5% stake in open offer for USD 104 million. US company also agreed to Rs 280 crore (USD 62 million) non-compete payment to the seller.

The deal was struck at around Rs 542/share while the current market price at around Rs 236 a share, which was not counting the non-compete fee to the Bangurs. AP Paper Mills was locked at 20% upper circuit.

Orient Paper, West Coast Paper, JK Paper, BILT and TNPL rallied 15-20%. Rama NewsPrint gained 5%.

Bombay Dyeing was up 1.5% after management rejig.

DB Realty jumped 16% as there were reports from agencies that none of the arrested officials of the company have done anything illegal. They have fully supported investigation department.

Tata Tele rallied 3.6%. Gitanjali Gems jumped 6.5%. Lanco was up 1%.

_PAGEBREAK_

Asian markets were trading in the green; Nikkei, Straits Times and Hang Seng went up 1.2%. Taiwan and Kospi gained over 0.5%. However, Shanghai fell 0.5%.

The US markets gained amid light volume & weak economic reports on Tuesday while shrugged off S&P