Heard on the street
Jain Irrigation is being accumulated by portfolio managers over the past month or so on hopes the government will increase its budgetary allocation to irrigation from the last year’s Rs 20,000 crore.
By ET Bureau |
MFs lap up Jain Irrigation on Budget boost hopes
Jain Irrigation is being accumulated by portfolio managers over the past month or so on hopes the government will increase its budgetary allocation to irrigation from the last year���s Rs 20,000 crore. Their hopes received a boost, after the Economic Survey released on Thursday said that growth in agriculture ��� the key growth engine of India���s rural economy ��� fell sharply to 1.6% from a growth of 4.9% the year before.
A key reason cited by experts for this drop is inefficiency in water usage or poor irrigation systems. Portfolio managers are betting that the government will announce measures to increase the total area under micro-irrigation, which is merely three million hectares. The total potential highlighted by the Task Force on micro irrigation is 66 million hectares. On Thursday, the stock moved up Rs Rs 6.6, or 1%, to close at Rs 650.
Local MFs buy PSU stocks as they see stake sales
Domestic mutual funds have accumulated shares of public sector undertakings (PSU) in chunks over the past couple of weeks on expectations that government will announce sale of stakes in some of its companies. Some mutual fund industry officials admit that most of these are short-term bets and do not rule out cashing out, if these stocks rise on indications of disinvestment in the Budget.
This is because they feel many of them are already adequately valued and their earnings offer very little positive surprises, at least, over the next few quarters.
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Contributed by Prashant Mahesh & Shailesh MenonToo busy to trade in stocks? Invest in Mutual Funds with ET Money!
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