Havells To Finolex: Wire And Cable Stocks Recover After Selling Pressure From UltraTech's Entry Plan
The wire and cable sector experienced a notable recovery on Friday, following significant selling pressure triggered by UltraTech Cement Ltd.'s unexpected entry into the segment. The market capitalisation of the top cable and wire stocks grew by Rs 1,514 crore, rebounding slightly from a sharp decline of Rs 35,500 crore on Thursday.
On Friday, the market cap of the top companies in the sector stood at Rs 2.14 lakh crore, reflecting a partial recovery. Among the five cable companies, the performance was mixed.
Finolex Cables Ltd. saw a slight increase of 0.43% in its stock price, bringing its market cap to Rs 12,629.73 crore, while Havells India Ltd. saw gain of 0.26%, with its market cap standing at Rs 90,737.28 crore.
Polycab led the recovery with a significant 3.86% rise, adding Rs 1,159.74 crore to its market cap, which now totals Rs 71,549.37 crore. While, RR Kabel and KEI Industries also posted strong gains, with their stock prices increasing by 4.21% and 4.28%, respectively. RR Kabel's market cap rose to Rs 10,354.81 crore, up by Rs 285.5 crore and KEI Industries' market cap reached Rs 29,184.63 crore, an increase of Rs 527.93 crore.
UltraTech Cement Ltd.'s announcement that it was venturing into the cable and wire business led to a sharp intraday decline of 6.38% in its stock price, bringing the scrip to Rs 10,264.4 apiece on Thursday. This move resulted in a loss of Rs 20,500 crore in market capitalisation for cement maker.
The announcement also exerted heavy pressure on leading cable and wire companies, causing their stocks to plummet to intraday lows ranging from 3% to 21%. Polycab India Ltd. alone saw a market cap reduction of Rs 15,900 crore. The cumulative market cap loss for the top players in the sector amounted to over Rs 35,500 crore.
Despite the initial shock, the sector showed resilience on Friday, with several companies posting gains.
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