This company which is a pioneer in the manufacture of automotive components and previously sold two-wheelers under the brand name Kinetic Honda, experienced its shares reaching the upper circuit in Wednesday trade after the company Board approved the raising of funds to reduce debt and invest in the EV segment.
Kinetic Engineering Ltd shares were locked at the 5 percent upper circuit at a price of Rs 124.20 from previous close price.
As per the company’s filing on BSE, Kinetic Engineering Limited to raise Rs.54 Cr through equity issue & Compulsory Convertible Preference Shares (OCCPS) issue to Promoters and Sale of Non-core assets, company planned to use funds for Expansion of plant, will be used to reduce debt by Rs. 18 crores and the investment in the EV subsidiary KWVL of Rs. 22-23 crores, and in the meantime the Promoter stake holding will increase from 54.68% to 59.35%.
Accordingly,the board approved the preferential offer of 22.85 lakh equity shares to promoters and promoter group firms for a total of Rs. 26.27 Cr at a price of Rs. 115 per share. This is the third year in a row that promoters have raised their ownership in the firm to 59.35%. The conversion from the prior year comprises 9,95,000 shares in 2021-22 and 11,72,879 shares in 2022-23.
Furthermore, the board approved the sale of the company’s extra land parcels for Rs. 25.50 crore. Last year, the stock gained 65.16 percent from Rs 75.20 to today’s market level. In three months, the stock has risen by 33.49 percent.
Kinetic Engineering Ltd supplies automotive components to the Medium and Heavy Commercial Vehicles and Tractor industries, as well as assembling Power Train Components. The firm serves both the domestic and foreign markets.
According to the company’s financials, operational revenue increased by 12 percent year on year to 136 crore in FY 22-23. During the same period, Net Profit increased by 200 percent to Rs 3 crore.
As per the FY22-23 shareholding pattern, the company’s promoters own 89.96 percent, while domestic institutional investors own 2.62 percent.
Written by Omkar Chitnis
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