Shares of Mahindra CIE Automotive rallied nearly 9% to hit a fresh all-time high in the opening trade on Wednesday, in an otherwise weak broader market, amid strong volume trade. The counter witnessed a surge in buying amid a report that the promoter company Mahindra & Mahindra (M&M) is likely to sell a 3.2% stake or 1.2 crore shares in the automotive component supplier via a block deal soon. The floor price for the deal is expected to be at a discount of 5-6% to the current market price.
Mahindra CIE shares opened a tad lower at ₹448 against the previous closing price of ₹452.80 on the BSE. Paring opening losses, the stock gained as much as 8.9% to hit a new record high of ₹493, while the market capitalisation climbed to ₹18,515 crore. On the volume front, 2.24 lakh shares changed hands over the counter as compared to two-week average volume of 0.41 lakh stocks.
Mahindra CIE share price has nearly doubled in the last one year from its 52-week low of ₹168 touched on May 25, 2023. In the calendar year, the counter has risen 33%, while it has added 28% in a month and 4% in a week.
Meanwhile, M&M shares rose nearly 1% to ₹1,939 levels in the early trade on Wednesday. The stock traded near its 52-week high of ₹1,997 touched on November 18, 2022. It hit its 52-week low of ₹1,630 on June 30, 2022.
Currently, auto major M&M holds 3.2% stake in Mahindra CIE Automotive. In March, M&M had sold 6.05% equity shares in Mahindra CIE through a block deal at a gross price of ₹357.39 apiece, which was nearly an 11% discount over the last closing price. Following the block deal, M&M’s stake in the company declined from 9.25% to 3.19%.
Last week, the company received approval from the central government to change the name of the company from Mahindra CIE Automotive to CIE Automotive India.
Mahindra CIE Automotive, which follows a January-December financial year, posted a 153% YoY growth in consolidated net profit at ₹195 crore in Q4 CY22, compared with ₹77 crore in the same quarter of the previous year. Revenue for the quarter rose to ₹2,247 crore from ₹1,169 crore in the corresponding quarter last year. The EBITDA was up 62.19% at ₹292.40 crore while margin stood at 13.01%.
The board of the company also recommended a dividend of ₹2.50 per ordinary equity share of face value of ₹10 each for the financial year ended December 31, 2022.
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