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Pipavav Defence spurts on stake sale buzz

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Capital Market
Last Updated : Feb 06 2015 | 12:01 AM IST

Pipavav Defence and Offshore Engineering Company rose 8.50% to Rs 54.25 at 11:32 IST on BSE on report Mahindra & Mahindra, the Hero group and a French shipbuilder are separately vying for a 19% stake in the shipbuilder.

Meanwhile, the BSE Sensex was up 128.08 points, or 0.44%, to 29,011.19.

On BSE, so far 23.54 lakh shares were traded in the counter, compared with an average volume of 10.04 lakh shares in the past one quarter.

The stock hit a high of Rs 56 and a low of Rs 53.40 so far during the day. The stock hit a 52-week high of Rs 73.90 on 6 June 2014. The stock hit a record low of Rs 33.25 on 26 March 2014.

The stock had outperformed the market over the past one month till 4 February 2015, rising 7.76% compared with 3.57% rise in the Sensex. The scrip had also outperformed the market in past one quarter, rising 25.94% as against Sensex's 3.67% rise.

The mid-cap company has an equity capital of Rs 736.21 crore. Face value per share is Rs 10.

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According to the media report, Mahindra & Mahindra, the Hero group and a French shipbuilder have started separate discussions with the promoters of Pipavav Defence & Offshore Engineering to purchase a 19% stake in the company that has facilities to build warships, submarines and LNG carriers.

As on 31 December 2014, promoters owned 44.50% stake in Pipavav Defence and Offshore Engineering Company.

A successful foreign bidder could hike its stake to as much as 49% through an open offer. In case an Indian company buys the 19% stake, it will have the option to raise it to 51%, the report added.

Pipavav Defence & Offshore Engineering Company reported net loss of Rs 68.33 crore in Q2 September 2014 as against net profit of Rs 4.54 crore in Q2 September 2013. Net sales declined 74.13% to Rs 208.17 crore in Q2 September 2014 over Q2 September 2013.

Pipavav Defence is an integrated defence, heavy engineering and offshore oil & gas assets construction company.

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First Published: Feb 05 2015 | 11:27 AM IST

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