JP Associates extends fall on earnings concerns

Last Updated: Thu, Nov 15, 2012 07:17 hrs

Shares in cement maker Jaiprakash Associates down 2.6 percent, extending their fall from a 2.4 percent decline during the short Diwali session on Tuesday. Stock markets were closed on Wednesday.

Jaiprakash reported late on Monday July-September net profit slumped 48.6 percent from a year ago, disappointing investors.

Morgan Stanley says Jaiprakash's cement operations proved sturdy, but attributes the profit decline to weakness in the construction and real estate divisions.

Debt remains a key concern, Morgan Stanley adds, noting net debt to equity has increased.

"We believe that the market will remain sanguine on the issue for a while, as the company tries to sell assets to reduce leverage," the investment bank says in a note dated November 14.

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