Auto Ancillary stock engaged in manufacturing and supplying automotive components to major players like KTM, Triumph, TATA Motors, and many more jumped upto 6 percent in the day’s trade following the strategic acquisition of a leading vehicle motor manufacturer for Rs. 1,372 Crores.
Price Action
With a market capitalization of Rs. 13,616 Crores, the shares of Minda Corporation Limited were trading at Rs. 569.50 per equity share, up 5.11percent from the previous day’s close price of Rs. 352.65.
What Happened
Minda Corporation Limited has agreed to acquire 49 percent of the total issued and paid-up equity share capital of Flash Electronics (India) Private Limited for a consideration of Rs. 1,372 Crores i.e, Rs. 537.18 per equity share.
Objective
The main objective of the acquisition is a form of a strategic partnership to create the fastest-growing EV platform in the country and help unlock synergies across products, customers, technology and manufacturing excellence. The products and technology of the partners will be showcased at the Bharat Mobility Expo.
Promising Acquisition
Flash Electronics (India) Private Limited is engaged in the business of manufacturing and selling automotive products across the spectrum of Electrical and Electronics, Electric Mobility, Gears, Shafts, Transmission Assembly, and Throttle Bodies for Two, Three & Four wheelers. It is among the market leaders for motors, motor controllers, vehicle control units, etc.
The target company’s future looks promising as it is expected to achieve revenue over Rs.1500 Crores in FY 25 and impressively deliver a CAGR of over 17 percent during past years. It is expected to deliver an EBITDA margin of around 14 percent and a steady ROCE of over 22 percent
About the Company
Minda Corporation Limited is engaged in the business of manufacturing and supplying automotive components like safety and security systems and many more associated components for the automotive industry, with well-known players as Ashok Leyland, Bajaj Auto, Hero Moto Corp, KTM, and many more as customers.
Coming to the financials it has been consistently growing with a growth of 8.66 percent in revenue during the latest quarter from Rs. 1,197.87 Crores in Q2FY24 to Rs. 1,301.66 Crores in Q2FY25, accompanied by profits of Rs. 58.77 Crores to Rs. 74.34 Crores.
Written by: Bharath K.S
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