The stock has almost doubled since October and though sentiment has improved towards chemicals recently, there should be more uplift on the trading side.. Whilst the shares are looking overvalued, they may appeal to investors willing to gamble that Laporte is worth more to the next interested party.. On full year forecasts of pounds 133m the shares trade on a forward rating of 15. Analysts reckon Laporte shares are worth around 600p on fundamentals, compared to yesterday's 749p, down 35p on the day. The warm air currents under the company's share price have been provided by takeover speculation following on-off talks with the Swiss group Clariant. This made Laporte's half year figures something of a sideshow yesterday. At least the ruse will save the company pounds 25m in tax that can be re-invested in the business.

They will receive a slightly reduced pay-out of 9p and will have to wait longer for their cash even though Laporte will cover the timed value of money with an interest payment. AT FIRST glance, Laporte's decision to scrap its interim dividend and distribute the pay-out via redeemable B shares looks a poor deal for shareholders. Some dealers have dubbed the group "the new ARM Holdings" and believe that, like ARM, Videologic shares have a lot of upside.. Videologic has linked up with Sega to supply the technical kit for its Dreamcast game station and further deals with the Japanese group are possible.

The market is awash with rumours that the micro-chip group is on the verge of some major contract wins. The broker, believed to be the Nomura, is supposed to set a target of 900p and predict that Aortech could win about 50 per cent of the $200m- a-year market for heart monitors.More cynical dealers believe that Aortech could use the incredible rise in the share price to raise money through a rights issue.KEEP AN EYE on Videologic, up 6p to 71p. Larger rival SkyePharma firmed 1.5p to 56.25p as the deal with a bug drug group nears.Oil driller Aminex was unchanged at 26p despite talk of positive news from its US fields, while food maker Perkins Foods digested a 1.5p rise to 105p amid vague talk of a bid.Builders' merchant Tudor cemented a 25p rise to 105.5p after agreeing a 108p-per-share offer from rival Meyer, up 3p at 458p.SEAQ VOLUMES: 969.6mSEAQ TRADES: 74,509GILTS INDEX: 106.75 +0.92SHARES in Aortech, the maker of heart monitoring devices soared another79.5p to 363.5p yesterday as rumours of a bullish note grew louder. A broker is rumoured to have prepared a note with a value of 1040p on the company. Trafficmaster motored 38p ahead to a best- ever 587.5p, on hopes of new contracts for its traffic control kit.The Internet wonderstock Freeserve slumped 28.5p to 211p on profit-taking and weakness among its American hi-tech peers.AIM-listed biotech group SR Pharma soared 41.5p to a yearly record of 380p. Australian rival QBE confirmed that it was the mystery bidder recently rebuffed by the UK group. IMI spiked 15.5p to 285.5p ahead of results and amid vague talk of a strike from TI, down 2.25p at 487.5p.Boiler maker Hepworth steamed 20.5p up to 206.5p after good results, while positive interims pushed recruiter Select Appointments, 56p better at 887.5p.Insurer LIMIT jumped 6p to 153.5p after buying back 500,000 shares at 147p.

Premier Farnell surged 14p to 269p after Warburg said it is worth 300p. And to cap it all, Vodafone AirTouch, down 45p to 1238p after ending a US joint venture, is rumoured to be looking at mobile phone price war which could hurt BT Cellnet.The rest of the sector was also sold off amid fears that valuations are stretched COLT shed 42p to 1406p, while Energis dropped 33p to 1639p Engineers continued to star in the midcap. It is also set to be hit by a new high-speed Internet link to be unveiled by Telewest, up 2p to 270p, at today's results. First, the telecom group is still reeling from disappointing results. BT was the day's worst blue-chip, plunging 46p to 986p on three pieces of bad news.