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Aban Jumps 25%

The stock became the hottest item on the Bombay Stock Exchange

One of India's largest oil rig companies, Aban Offshore, got a pat on the back from Morgan Stanley that caused its stock to jump the most in some 15 years to become the best performer on Tuesday on the Bombay Stock Exchange BSE 500.

The reason behind Morgan Stanley’s move may possibly have been better future prospects due to an improving business environment in the country and abroad (it has found contracts for four of its rigs at $150,000 per day), rising oil prices, as well as the possibility of its debt getting restructured -- the amount is reportedly more than $2.5 billion.

Morgan Stanley had given an overweight rating and increased the price target to Rs 1,114 per share – a whopping 88 per cent.

It was reported that the company's board was set to meet in Singapore on Tuesday on the matter after its biggest lenders, State Bank of India and ICICI Bank indicated a debt restructuring package that could extend the deadline for the repayment of the principal amount by as much as 24 months.

In its latest quarterly result in April, the company had announced a loss of Rs 930.40 million.

The share of the company on the BSE opened at Rs 670.00, climbed to a maximum of Rs 815 and closed almost at the high point at Rs 813. However, the extreme nature of the stock is clear from its 52-week H/L, which is Rs 2,815/Rs 227.50 respectively. Its market capitalization is Rs 30,731.40 million.

The stock has been doing consistently better than Sensex since May 2009.

Also Read:
Aban Offshore Stock Snapshot

Mutual Funds Holding Aban Offshore stock