Stock Market: Deepak offers aarti on bourses washed with chemical

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By S Jha

New Delhi, August 29: Indices remain stuck in congestion zone as heavyweights fail to provide leadership. With the largecaps not rising to the occasion, indices remain firm on sideways mode. At the same time, the scrips in the midcap and smallcap remain heated and investors appear to be looking for alternative investment opportunities with valuation gaps.

After the sharp rise in the pharmaceutical sectors, the brokerages have turned their attention to the specialty chemical sector. Some of the brokerages are claiming that the specialty sector scrips may report better in the second quarter of the current fiscal.

It may be recalled that China is the biggest competitor of the specialty chemical sector, and the scrips were battered on the bourses after Beijing went for full opening after the Covid-19 pandemic. Until then, the specialty sector was the hot cake on the bourses.

Now, most of the specialty chemical scrips are languishing at almost 56-week lows, and, thus they are seen to be attractive on valuation gaps with their peers in other sectors. The alternative attention theme of the investors caught the likes of Deepak Nitrite on a day when the indices were most indecisive.

Deepak Nitrite gained over six per cent. It was closely followed by another specialty chemical scrip Aarti Industries, which also gained over six per cent. The 56-week low of Aarti Industries is Rs 445 and it closed on Tuesday at almost Rs 484, while its peak has been Rs 924. Making a case for secular rally in the specialty chemical sector, almost everyone in the pack was running and spurting. The positive sentiment was also provided by the government providing the Mini navratna status to Rashtriya Chemical, which also climbed by over seven per cent.

The chemical sector bluechips such as Atul Limited, Tata Chemical, and others also gained strongly. The midcap and smallcap among the sector such as Himadri Speciality, Meghmani Organics and others were also trending up on Tuesday. It may be noted that China Plus One theme is playing out in the global supply chains, and the specialty chemical sector along with metal pack may be watched out in the near future as China increasingly gets isolated by the western powers.

In the meantime, the PSUs – BEML and BHEL – remain among the bullish scrips, which continue to gain strength each day on the bourses. Both the scrips netted fresh gains on Tuesday.