Stocks In Action For September 26, 2012

As per a report in Business Standard, the paper industry is under pressure due to cheaper Chinese imports. Despite the rising input costs, leading paper companies have imposed price cuts of up to 5 per cent in the quarter to maintain sales. This is also to enable them to clear off the piled-up stocks. The report says that the scenario could also take a turn for the worse since there will be a slump in demand. Some of the companies that have taken a price cut include JK Paper and TNPL. The stock performance of the paper companies is therefore expected to be under pressure in the second quarter.

According to a news report, consumer durables’ major Godrej has joined hands with the e-commerce site of Indiatimes Shopping to launch an online store, targeting Rs 100 crore per year from the venture in the next five years. Although online trading contributes very little to the overall revenue of the consumer durables industry, it is growing day by day. “This collaboration is to tap the potential and have the first mover’s advantage,” said Godrej Appliances’ executive vice president for marketing and sales, Kamal Nandi. This is a positive step taken by the company and we may see some upside movement in the scrip today.

Auto major Mahindra & Mahindra yesterday said that it will invest Rs 1,500 crore to develop a new vehicle platform with its Korean subsidiary Ssangyong Motor. M&M holds 70 per cent stake in SMC, for which it had shelled out USD 463 million (about Rs 2,105 crore) in 2010. Post this news we may see some positive momentum in the stock today.