Moser Baer bucked the trend in a weak overall market after the company increased prices of recordable compact discs by 5-10%.

The scrip of the world's third largest recordable compact discs maker rose 3.54% to Rs 224 by 14:00 IST. It recovered from its intra-day low of Rs 213 by then. Over 169,000 Moser Baer shares were registered as volumes till that time. In contrast, in the seven sessions between 26 February and 7 March 2003, the stock had fallen 12% to Rs 216.35 from Rs 245.50.

The rise in the scrip is purely on news that the company has increased prices of CDRs by 5-10% following a global shortage in the product. The rise in prices is expected to have a positive impact on the financials of the company for the next quarter.

Moser Baer has been proxy to a host of positive developments over recent weeks starting early January 2003 when the European Commission decided to terminate anti-dumping proceedings against the company with respect to the manufacture of CDRs. Recordable compact discs are data storage devices with multiple uses. They can be used to create computer back-up files of vital information, to store downloaded music from the Internet or to copy pirated software.

Recently, MBIL announced two seperate deals with Imation Corp, expected to boost the company's revenues by $100 million annually. MBIL signed a strategic long-term sourcing deal with Imation Corp, one of the largest data storage media companies in the world, to provide high quality optical media solutions.

In another significant development, both the companies have entered into a strategic joint venture in which 51% of the equity will be held by Imation Corp. The JV, entailing a total investment of $10 million (Rs 48 crore), will focus on customer servicing, long-term technology transfer and joint R & D.

Both these developments could result in incremental revenues of approximately $100 million (Rs 480 crore) per annum for MBIL, catapulting it into a global leadership position in the optical storage media industry, MBIL said.

The Imation deal makes for increasing presence of MBIL in the US markets. MBIL has been eyeing an increasing share in the US market. Currently, it derives major revenues from European markets.

MBIL got a big boost early this year after the European Commission decided to drop anti-dumping duty proceedings with respect to recordable compact disks. MBIL has a major exposure to Europe, exporting 45-50% of its products there.

Late January 2003, MBIL said it was considering a price hike for products in Q4 ending 31 March 2003 following the improving market dynamics and favourable outcome of the anti-dumping investigations. So far, the company's performance in the current fiscal has been affected by pressure on profit margins, which, in turn, has been due to a fall in product prices.

For Q3 ended 31 December 2002, MBIL posted a 7.8% rise in net profit to Rs 64.88 crore on a 74% growth in total income to Rs 297.91 crore (Rs 2.97 billion). The company has maintained guidance of a 10% growth in earnings for FY 2002-03.