Shanti Gears has soared over 10% at Rs 57.75 on back of huge volumes on reports that Bharat Forge, the world's largest forging manufacturer, is in talks to buy out a significant stake in the industrial-gear box maker. A deal with Shanthi Gears will help Bharat Forge widen its presence in the industrial gears business.
“Shanti Gears command a valuation of eight times of their respective earnings before interest, taxes, depreciation and amortisation (Ebidta) of Rs 64.4 crore for the year ended March 2012, according to investment bankers,” the report suggests.
The stock opened at Rs 55.55 has seen over two-fold surge in trading volumes. As many as a combined 993,360 shares have already changed hands on the counter in morning trades, against an average sub 400,000 shares that were traded daily in past two weeks on the NSE and BSE.