Shares of JK Paper Ltd rose 3% on Tuesday’s early trade as the company on Mondayentered into share purchase and shareholders’ agreements to acquire 85% shares of Horizon Packs Pvt Ltd, and Securipax Packaging Pvt Ltd.
As per the share purchase and shareholders’ agreements, the balance 15% will be acquired within a period of three years.
“The purchase consideration for acquisition of 85% of equity shares of Horizon Packs will be 19.33 rupees per equity share of l0 rupees each, and of Securipax will be 1,256.95 rupees per equity share of 100 rupees each,” said the company in an exchange filing on Monday.
Harsh Pati Singhania, vice chairman, and managing director of the JK Paper believes it to be a privilege to join hands with India’s largest player in the corrugated packaging segment.
“This together with JK Paper’s upcoming corrugated facility in Ludhiana will establish it as the largest player in the corrugated packaging industry,” he added.
On the technical front, analysts believe the stock to be in short term uptrend. “The overall structure of the stock is positive, but recent price set up shows consolidation, and major action on either side is unlikely,” said Amit Trivedi, market analyst, assistant vice president - technical and derivatives research at Yes Securities.
Rajesh Bhosale, equity technical and derivative analyst, Angel One, said that good volumes are expected. However, it has come down from higher levels, closing for today would be crucial, 440 level seems an immediate resistance whereas 410 support, as of now its sideways.
Majority of the analysts, do not recommend buying the paper producer’s stock.
As of today, the stock has gained 118.75% from 52-week low of 192.0. Further, its trading 5.2% above 100-day moving averages, and 23.5% 200-day moving average. JK Paper’s weekly average delivery volume is 43.52%.
According to a MintGenie poll, three analysts have a ‘strong buy’ call on the stock.