The shares of one of the largest producers of high-end specialty chemicals hit 9% upper circuit to ₹4.85 per share after the company paid off an additional loan of ₹ 7.5 crore, decreasing the initial bank debt by 78 percent.
On Wednesday,.Vikas Ecotech Ltd shares hit a 9% upper circuit from the previous close price on the National Stock Exchange. The company has a market capitalization of ₹ 628 crores.
As part of the company’s pre-defined debt reduction program, Vikas Ecotech Limited repaid another ₹ 7.5 crore to bankers, bringing the total bank debt to ₹ 35 crore.
While sprinting towards the targeted debt reduction, the Company initiated the process in August-September 2021, and since then, the Company has repaid a total of ₹126.2 crore to the bankers.
Thus, the overall bank debt has been reduced from its high of around ₹ 161.2 crore. Currently, around ₹35 crore, representing a 78% (approx.) reduction from the peak level. The business disclosed this in its exchange filing.
The company‘s revenues reduced by 55 percent year on year, from ₹134 crore in Q2FY23 to ₹ 60 crore in Q2FY24, while net profit improved by 50 percent from ₹ 3.54 crore to ₹ 1.77 crore.
Vikas Ecotech Ltd shares have gained 56% in the last six months and 54% in a year.
Vikas Ecotech Limited is primarily engaged in the business of manufacturing Specialty Chemicals focused on Additives and Specialty Polymer Compounds. The company manufactures methyl tin mercaptide, tin tetrachloride, oxidized soya bean oil, thermoplastic rubbers, 2-ethyl hexyl thioglycolate, and carbon black products.
The company had recently acquired a 100 percent stake in a plasticizer manufacturing business valued at an enterprise value of around Rs 27 crore, as per the company report, this acquisition may contribute additional revenue of about Rs 200+ crore per annum for the first year.
Vikas Eco Tech Limited has planned to install an additional line to increase the production of Polymer and Polyester Compounds at its existing plant located at Shahjahanpur, Alwar, Rajasthan.
Written by Omkar Chitnis
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