Shares of the Swaraj Engines Ltd (SEL) jumped 15.75 percent to Rs.1962 on the BSE during Wednesday's intraday trade after Mahindra & Mahindra (M&M) announced an acquisition of additional 17.41% stake in the company.
The stock opened at Rs. 1804.35 and rose 8.7 percent to hit its 52 week high of Rs. 1962 in the early morning session after 343 days.
At the current level, the stock is trading 44.70 percent higher than its 52 week low marked on 28th March 2022.
Furthermore, the stock has shown a surge of 34.70 percent since past six months.
On Tuesday, Mahindra & Mahindra(M&M) Ltd announced proposals to pay Kirloskar Industries Ltd (KIL) 296 crore to purchase an additional 17.41% share in Swaraj Engines Ltd, PTI reported.
SEL, who is currently an associate of the company, will thus become a Mahindra and Mahindra subsidiary (M&M).
According to M&M in a regulatory filing, the acquisition will increase the company's stake in Swaraj Engines Ltd (SEL) from 34.72 percent to 52.13 percent. The company proposes to acquire 21,14,349 equity shares constituting 17.41 per cent of the paid up equity share capital of SEL from Kirloskar Industries Ltd (KIL) at a price of ₹1,400 per share. By September 30, 2022, Mahindra intends to have the acquisition closed.
The Net profit of Swaraj Engines rose 17.50% to ₹39.54 crore in the quarter ended June 2022 as against ₹33.65 crore during the previous quarter ended June 2021. Total revenues rose 26.58% to ₹398.35 crore in the quarter ended June 2022 as against ₹314.71 crore during the previous quarter ended June 2021.
SEL is into manufacturing and supplying of diesel Engines in the range of 22 HP to above 65 HP. The company is equipped with highly productive & precise quality analyzing machines. It is also manufacturing hi-tech engine components.
To date, SEL has supplied over 10,00,000 engines for fitment into Swaraj tractors, its website shows. It was promoted in 1985 by erstwhile Punjab Tractors Ltd, which has since merged with M&M, and the then Kirloskar Oil Engines Ltd (now KIL).
Its current market capitalization is Rs. 2291.96 Cr. The firm recorded gross sales of Rs. 11381.53 Cr. and total income of Rs. 11478.08 Cr. for the most recent quarter.