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Virendra Verma
Jayanta Mallick

THE financial results of Wipro seem to have turned Unit Trust of India (UTI) bearish on the technology stocks. Dealers said that the country's largest fund was seen selling all top-rung IT stocks. Other domestic funds have also joined UTI by selling a good quantity of technology stocks.

Wipro net profit was up by 17 per cent in the third quarter at Rs 223.6 crore, but this was lower than the market expectation of 25 per cent growth.

The stocks sold by UTI included Infosys, Wipro, NIIT and Satyam Computers. There were also talks of some selling in second-rung IT stocks.

Institutions shift to old economy

INSTITUTIONAL players are shifting their portfolios from the technology to old economy stocks. Most funds, both domestic mutual funds and foreign institutions, were understood to buying more of old economy stocks. Their view is that the technology stocks are not expected to provide good returns this year. The fund managers are now discounting the next financial (2002-03) for their investment strategies. This is one of the factors behind the uptrend in stocks such as BHEL, Mahindra & Mahindra, Bajaj Auto, Hero Honda and other leading manufacturing companies' since the beginning of 2002. The turnaround in some of the sectors and the increase in a number of mergers and acquisitions are driving the fund managers towards the old economy stocks.

MFs drive on

TVS Motors

AFTER the break-up with Suzuki Motors, TVS Motor (formerly TVS Suzuki) has outperformed its peers on the bourses. From a low of Rs 75, just after the break-up with Suzuki, the stock has already gained over 225 per cent in just over three months. On Friday, the stock touched a 52-week high of Rs 254.90 on the BSE before closing lower at Rs 249.15, still up 7.07 per cent from Thursday's closing.

Despite the sharp rise in the stock price, mutual funds are still bullish on the stock and are busy buying it. The main reason for them turning bullish is the good performance by the company's motorcycles segment. In addition, their view is that the stock is still undervalued compared to its peers such as Hero Honda and Bajaj Auto. The introduction of more two- wheelers despite the break-up with Suzuki showed the internal strength of the company, said a fund manager.

UB group stocks

on the rise

The stocks of UB group outfits — United Breweries Ltd and McDowell — have attracted huge volumes on the Bombay Stock Exchange and a spirited price spurt on both BSE and National Stock Exchange on Thursday and Friday.

On the BSE, it closed the day at Rs 224.05 with a volume involving 5,25,233 shares. On Thursday, it had closed at Rs 194.15 and 2,39,401 shares changed hands. On the NSE, the stock saw a lower volume (2,91,356 shares) than that on BSE and finished at a marginally lower price of Rs 228.20 on Friday.

The volumes in McDowell on the BSE shot up to 3,98,436 shares from Thursday's level of 33,068 shares. It finished at Rs 66.85, up from Thursday's closing of Rs 59.20. On NSE, Friday's closing price was Rs 58.20 on a volume of 49,289 scrips.

Market rumour has it that two Mumbai-based broking houses had been buying these scrips for the last couple of days. Grapevine has it that UB Ltd may have a strategic partner in the near future. UB group was planning a restructuring of the liquour business. However, there were no announcements on this by the company in recent weeks.

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