Surged up by news on delisting its cement arm, Binani Industries has surged 85% in the markets over the last five trading sessions. It touched a 52-week high yesterday of Rs 203.60 and gained a further 9.99%, or Rs 18.50 to close at Rs 203.60. There were pending buy orders of 385,815 shares, with no sellers available.
Why the stock is up 85%?
The stock hit the upper circuit on the Bombay Stock Exchange on October 8 when the company announced that it would acquire all public shares of Binani Cement and delist it from the exchanges.
With strong appetite seen for the cement company by its acquirer post the delisting, Binani Cement is likely to maintain its market share going forward.
As on September 30, promoters Binani Industries hold 69.90% stake, while non-institutions hold 26.93%, domestic institutions hold 2.06% and foreign institutional investors hold 1.11% in Binani Cement, BSE data showed.
As on March 31, 2010, Binani Industries, has a market cap of Rs 410 crore, with a net debt, of close to Rs 1,400 crore.
With Binani Cement setting up greenfield plants with a capacity of 2.5 million tonne per annum in Gujarat, a further 2 million tonne per annum in Mauritius, it expects to have a total operational capacity of 15 MTPA by 2011.
What we are expecting today?
Today this stock might cool after the 3 hot session from 8-Oct. Our recommendation would be to enter this stock around Rs.170-190 for target Rs.243 keep stoploss around Rs.158.