Shares of JK Cement Limited closed their trading session today at a price of Rs 3,242.85. The scrip hit its 52-week high mark at Rs 3,324 which also was observed to be the stock’s closing price. It has a market capitalization of Rs 25,056 crores.
The company, in a recent filing with the exchange yesterday, informed that its Board has given the approval to execute a share purchase agreement with ‘Toshali Cements Private Limited’ and its shareholders to acquire 100% of the equity shareholdings from the existing shareholders. The total cost of acquisition is estimated to be Rs 157 crores.
After the completion of the above-mentioned acquisition process, the acquirer, i.e., JK Cement will have management control and have Toshali Cements as its subsidiary company.
JK Cement Limited is engaged in the process of manufacturing cement and cement-related products that primarily consist of white and grey cement. A majority of its revenue is generated from domestic operations within India.
ICICI Securities gave a ‘Buy’ tag to the company with a target price of Rs 3,856 indicating an upside of around 19 percent as compared to the current price levels.
The rationale behind providing such a recommendation is pertaining to the positive outlook of the sector, great volumes and favorable prices of grey cement, etc.
The company recently announced its financial results for FY2022-23 which portray a jump in the QoQ operating revenue from Rs 2,436 crores during Q3FY22-23 to Rs 2,777 crores in Q4FY22-23. In congruence with the pattern shown above, the net profit numbers, during the same period, took a shift from Rs 37 crores to Rs 110 crores representing an increase of approximately 197 percent.
According to the latest shareholding data available for the March 2023 quarter, Promoters of the company hold a 45.83 percent stake, and Foreign Institutional Investors (FIIs) hold a 15.54 percent stake in the company.
Written by Amit Madnani
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