Heard on the Street: Watch out for unwinding in Rajesh Exports

By Palak Shah

Dalal Street traders managed to create enough buzz in Rajesh Exports ahead of its buyout of acquisition of Valcambi, the world’s largest precious metals refiner, for about Rs 2,600 crore. The talk is that a group of deep-pocket traders from the dominant Kutchi community was mopping up shares, which helped the stock to more than double in a month. Sceptics say this sharp rise in the share price is unwarranted given that the benefits of the acquisition could be in the longer run only. The PE ratio of the stock is nearly 25, which, analysts said, is expensive. As the stock is illiquid, unwinding of aggressive bets could trap small traders.