India Cements surged today extending the recent revival in the battered stock.

India Cements (ICL) shares sprang forth 9.8% on BSE in afternoon trades to Rs 18.90. The scrip was trading near the day's high of Rs 19. The scrip rallied on decent volumes, with 5.6 lakh shares changing hands on the counter on BSE by the end of one half of trading.

The stock has witnessed a recovery from a lower level in the last few trading sessions. A recovery in cement prices in the south and the company's debt restructuring initiatives have triggered the revival in the stock. From a low of Rs 12.95 on 31 March 2003, the stock has gained 45.9% in less than two months to the current Rs 18.90. Earlier, sustained selling pressure plunged the scrip into the dumps, to a low of Rs 12.95  - a level it did not see for years.

Cement prices in the south, which had been affected the most in the last few years, are witnessing an uptrend, which is partly driving up the ICL counter. ICL is a leading player in the southern cement market. Cement prices are key to the performance of cement companies.

ICL's stock has also recovered on the back of its debt restructuring. ICL has huge debts amounting to Rs 1,800 crore. Huge interest payment on the debt has taken its toll on the company's financials. As it can be recalled, ICL had resorted to certain high cost acquisitions - the  benefits of which did not go the expected way in view of sharp fall in cement prices in the south over the year due to excess capacity situation.

The restructuring package of ICL involves  restructuring  of  operations  including voluntary retirement  scheme, sale of assets, restructuring of debt including working capital facilities. IDBI  has  been  appointed  as  the  monitoring  agency  to  oversee  the implementation.

In  a  bid  to  lower debt, the company, last year, sold Sri Vishnu Cement, which  it had acquired from the promoters of Raasi Cement a couple of years ago, to Italcementi. The deal fetched the company Rs 350 crore.

For Q3 ended 31 December 2002, ICL's net loss surged to Rs 50.5 crore as compared to a net loss of Rs 26.25 crore in Q3 December 2001. The net sales fell 10% to Rs 197.95 crore from Rs 220.73 crore.