The small-cap stock saw a rise of 2.4 percent, reaching an intraday high of Rs 1,716 in the first half of Wednesday after news of a promoter acquiring an additional stake broke in the market.
GMM Pfaudler saw its share rally after the promoters were looking to increase their stake in the company. The Patel family, a promoter group, currently holds a 24.18% stake in GMM Pfaudler Ltd, making them the largest shareholder. They agreed to purchase an additional 1% stake from Pfaudler Inc., another promoter entity, through an inter-se promoter transfer in December 2022.
The deal involves the purchase of 4.49 lakh equity shares or 1% stake from Pfaudler Inc. through Millars Machinery, a key entity within the promoter group, valued at ₹1,700 per share. The transaction is expected to be completed within the next four days. With this, they will entirely exit from the company.
After the acquisition, the family’s stake will increase to 25.18%, thereby consolidating their control over the company.
However, the share price later dropped by 1.5 percent and closed at Rs 1,654. In the past six months, the shares have increased by 15 percent.
GMM Pfaudler reported that net revenue increased by 20 percent year on year from Rs 780 crores in Q2FY23 to Rs 937 crores in Q2FY24. On a quarter-on-quarter basis, their revenue increased 2 percent from Rs 912 crore in Q1FY24 to current levels.
However, their net profit declined 27.4 percent year on year, from Rs 97 crores in Q2FY23 to Rs 70 crores in Q2FY24. On a sequential basis, their net profit rose by 29.5 percent from Rs 54.2 crores in Q1FY24 to current levels.
GMM Pfaudler is a small-cap company with a Market capitalization of Rs 7,400 crores. It also has a return on equity (ROE) of 32 percent and a return on capital employed (ROCE) of 25 percent.
GMM Pfaudler specializes in providing corrosion-resistant technologies, systems, and services to the chemical and pharmaceutical industries worldwide. With 16 manufacturing locations across four continents, the company employs over 1,800 people and boasts a strong sales and service network.
Written by Sriram KV
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