The latest analysis and commentary by stock market guru SP Tulsian of sptulsian.com on what is moving the markets today.

On Jain Irrigation, Tulsian said: “Firstly, this is a hugely belated move on part of the management. In fact, they have been struggling to retire the debt of Rs 2,500 crore which they have been talking about for at least the last three years. We have nothing seen getting succeeded in that. If I just presume that they will be able to mobilise — that they are looking for about Rs 3,000 crore and if they are able to retire the debt that should really be helping the company. If they mobilise Rs 3,000 crore in one go, use that money to retire the debt then that will be seen as a positive.”

He added: “As I said if the EBIT is Rs 2,030 crore and they are able to mobilise Rs 3,000 crore and even I take ballpark 10 percent then this will be seen EPS accretive because they will be able to reduce the interest burden which is now to the extent of about Rs 530 crore on annual basis maybe by about Rs 300 crore. Even if I ballpark take a 10 percent interest while it will be higher, 11-11.50 percent then also it will be seen EPS accretive and this will be seen as a positive move but they should be able to succeed in mobilising any amount over Rs 2,500 crore plus from this plastic division.

Talking about United Spirits, he said: “We have seen the consumption stocks moving up and after the dull Q4 numbers from United Spirits probably the renewed buying maybe coming in. I don’t think any positive trigger is seen for the brewery stock because if you really take the case of molasses as a raw material to make the extra neutral alcohol has risen by 10 times. Last year same time, the molasses used to get sold at Rs 200-400 per tonne and now it is getting sold at Rs 4,000 a tonne so I don’t know what is the reason it can only be considered as to do with the consumption stocks seem to be in the limelight which have seen buying for the last one month and now United Spirit having seen a quarter with the other consumption stocks theme as well.”

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