Newspaper article The Evening Standard (London, England)

Morgan's Praise Fires Up Vedanta

Newspaper article The Evening Standard (London, England)

Morgan's Praise Fires Up Vedanta

Article excerpt

Byline: Rosamund Urwin MARKET ROUND-UP

VEDANTA Resources claimed first place on the Footsie winners' board today as Morgan Stanley says the miner's shares could be worth a staggering [pounds sterling]68 -- even if metal prices hardly rise from their current levels.

Shares in the India-focused copper producer, which is controlled by Indian billionaire Anil Agarwal, surged 56p to 1958p as analysts said Vedanta's growth potential should see the company double in size in the next two years. Analysts also reckon the effects of cost-cutting have not been priced into shares.

The big-hitting broker has upped its rating on the stock to overweight, with a target price of 2623p, but its bull scenario gives a target of 6814p.

Deutsche Bank is also a fan of Vedanta, today advising clients to snap up the shares and lifting its price target from 2100p to 2300p.

Shares in London fell, losing early gains in a shaky start to the first day of the new quarter. The FTSE 100 index dropped 59.54 points to 5074.36.

Good news on consumer confidence in the US was more than offset by bad stateside employment figures, sending the Dow Jones down 118.81 points to 9593.47.

Bid talk initially boosted Legal & General for a fourth day -- and this time Clive Cowdery's Resolution was rumoured to be back in the frame. One trader said he reckoned that part of the rise is down to short-sellers closing their positions in case an offer is imminent.

But traders weren't convinced by speculation that National Australia Bank, which owns Yorkshire Bank and Clydesdale Bank, could be preparing an offer at 120p a share, saying that Resolution looks a far more likely suitor. Cowdery's group, which has already taken over Friends Provident, is rumoured to have met with L&G in the past few days.

Speculation is that L&G might be searching for a white knight to rescue it from Resolution's clutches, with Australia's AMP another name being bandied about in the past week as a potential bidder. Generali, the Italian insurance giant, ruled itself out of the running yesterday.

More than 80 million L&G shares changed hands by the end of the day, making it the most-traded stock. …

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