Tube Investments gains 4% as arm acquires majority stake in an EV startup
Shares of Tube Investments of India rallied 4 per cent to Rs 2,088.40 on the BSE in Tuesday’s intra-day trade after acquisition of lPL Tech Electric Private Limited (IPLT) in an all cash consideration up to Rs 246 crore towards purchase and subscription of fresh equity shares. lPLT is a startup engaged in manufacturing and sale of electric heavy commercial vehicles.
Tl Clean Mobility private Limited (TICMPL), a wholly owned subsidiary of the Tube Investments of India (Tll) has entered into definitive agreement for acquisition of 65.2 per cent in the equity share capital of IPLT, through a combination of purchase of equity shares from the founders and other exiting shareholders of IPLT and by way of subscription to fresh equity shares, for an aggregate consideration of up to Rs 246 crore, the company said in a exchange filing.
The acquisition is expected to be completed on or before October 31, 2022, subject to satisfactory completion of the conditions precedents as contained in the agreements executed between the parties.
TII board also approved a further investment of up to Rs 150 crore in the equity share capital of TICMPL and provision of lnter Corporate Deposit of an amount not exceeding Rs 100 crore to TICMPL, the company said.
TII is a flagship company of the Murugappa group. It is one of the leading product manufactures for major industries such as automotive, railway, construction, mining, etc. The company is also the second largest player in bicycle business.
TII’s entry into 3W electric manufacturing will mark the group’s foray into automobile manufacturer from an ancillary player. Due to supply shortage, the launch has been extended to Q2FY23.
In the past one month, TII has zoomed 40 per cent, as compared to 6 per cent rise in the S&P BSE Sensex. It had hit a record high of Rs 2,095 on July 11, 2022.
Brokerage firm, Motilal Oswal Financial Services maintains a ‘Buy’ rating on TII with target price of Rs 2,230 per share.
TII’s FY22 annual report highlights the progress made in the core business, particularly in exports, capability improvements in the core business, strategy on e-mobility, and its plans to foray into Medical Devices and Electronics under its TI-2 strategy. The management’s focus is on deliverance of four metrics – revenue growth (up 106 per cent YoY in FY22), profitability (up 100bp in EBITDA margin), RoIC (up 22.3pp to 42.7 per cent), and FCF (around Rs 640 crore in FY22 v/s Rs 110 crore in FY21), the brokerage firm said in stock update.
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.
Comments are closed.