Market Report: Lottery partners' shares just the ticket for investors

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The Independent Online
WINNERS of the National Lottery prize are already beginning to hit the stock market jackpot.

Shares of the three quoted companies that control the successful Camelot consortium made firm progress as their winning ways began to captivate investors.

Cadbury Schweppes gained 15p to 472p, De La Rue 15p to 889p and Racal Electronics 10p to 248p. Each has a 22.5 per cent Camelot interest. The controversial US group G-Tech also hugs 22.5 per cent with the Japanese- controlled computer group ICL holding the remainder.

Bullish comments at the Racal results presentation by Sir Ernest Harrison, chairman, about Camelot's prospects quickly filtered into the market as Barclays de Zoete Wedd, the securities house, was drawing attention to the appeal of Cadbury.

Many believe Camelot is an early candidate for a stock market flotation. In some quarters a valuation of about pounds 700m is being suggested which, it is calculated, would represent a profit approaching pounds 150m for each of the four main constituents.

The Camelot display was in line with the rest of the market, which expressed relief over John Major's assertion that dividend controls were not planned. Better-than-expected production figures also helped.

With government stocks back on the uproad, gaining one and a half points, shares turned in an upbeat performance with the FT- SE 100 index up 33.4 points to 3,038.2.

But volume, although higher than in recent days, was again disappointing. There is a feeling that the bear market could be over, but worries hover about the fragility of such a low volume market.

Standard Chartered, the banking group, gained a further 9p to 271p, reflecting US investment presentations. A London presentation helped Guinness to strengthen 9p to 477p.

GKN, the vehicle components group, bounced 12p to 603p. Long-running litigation by its Westland helicopter offshoot has produced a pounds 115m windfall from an Arab group that pulled out of a helicopter deal. GKN had already received pounds 25m and proceedings continue.

As expected, GKN, helped by the Westland takeover, is rejoining the FT-SE 100 index at the expense of Tarmac, unchanged at 157p.

At the time of the GKN deal 150 Westland shareholders opted for a share of the proceeds of the Arab dispute rather than give up their entitlement in exchange GKN stock. They will get loan notes equivalent to 45p per Westland share next month.

Lucas Industries' forthcoming investment presentations in France lifted the shares 6p to 180p.

London International, the condom maker, fell 8.5p to 90.5p on its pounds 115.2m cash call. The seven-for-two Euro Disney rights clipped the shares 10p to 405p and the Avesco demerger teased another 3p from the shares at 79p.

Two modest takeovers helped sentiment. Motor dealer Evans Halshaw bid pounds 32.6m for rival Davenport Vernon and CLT, the European media giant which used to own Radio Luxembourg, swooped on Chiltern Radio. Evans lost 31p to 484p, Davenport surged 45p to 158p and Chiltern jumped 33p to 238p.

But cautious comments overshadowed a sharp profit advance at motor dealer Caffyns, leaving the shares 40p lower at 365p.

J Sainsbury rose 9p to 393p. Yamaichi, the Japanese securities house, said buy because the discounters may be running out of steam. Analyst Bill Myers commented: 'Kwik Save's sales are slowing, Lo-Cost's margins have halved and Shoprite has delivered a major profits warning.'

BPB Industries gained 7p to 298p on a proposed pounds 50m plasterboard plant in Berlin.

Newcomer Argent, a property group, made a firm start, reaching 266p from a 255p sale price.

Coats Viyella rose 3p to 222p. NatWest Securities, which has started researching the textiles group, said the shares would outperform.

The FT-SE 100 index jumped 33.4 points to 3,038.2 and the supporting FT-SE 250 index moved ahead 23.2 points to 3,600.8. Turnover was 591.7 million shares with 22,979 bargains. The account ends on 17 June with settlement on 27 June.

Dealings in shares of the private client stockbroker Brewin Dolphin are due to start today. Charterhouse Bank placed 7.3 million at 150p. Brewin's clients took up 1.3 million, with the rest going to institutions and 'other clients'. Brewin has 32,000 clients and a network of 12 offices. A year ago it acquired Bell Lawrie, one of Scotland's largest brokers.

MMI, developed by Bob Morton, has paid pounds 5m in shares for WMGO, with interests in advertising, direct marketing and sales promotion. A pounds 1.94m cash call is under way. After the expansion Mr Morton will have 17 per cent and the WMGO vendors 25 per cent. WMGO had 9.3 per cent of Yellowhammer, an advertising group which went into receivership four years ago.

Shares of Hawtal Whiting, the automotive designer, have motored since the group announced details of a pounds 5m cash call. They rose a further 9p to 93p yesterday. The group has had a difficult time but trading has improved and it is back in the black. Pledges to take up the rights have come from the board and its largest institutional shareholder, PosTel.

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