Suzlon Energy rose 3.52% to Rs 6.77 at 11:02 IST on BSE after the company said it divested 75% stake in its China-based subsidiary to Poly LongMa Energy for $28 million.
The company made the announcement after market hours on Wednesday, 18 September 2013.
Meanwhile, the BSE Sensex was up 484.71 points, or 2.43%, to 20,446.87
On BSE, 13.10 lakh shares were traded in the counter compared with average volume of 15 lakh shares in the past one quarter.
The stock hit a high of Rs 6.95 and a low of Rs 6.70 so far during the day. The stock hit a record low of Rs 5.72 on 28 August 2013. The stock hit a 52-week high of Rs 26.90 on 6 February 2013.
The stock had underperformed the market over the past one month till 18 September 2013, sliding 1.06% compared with the Sensex's 7.33% rise. The scrip had also underperformed the market in past one quarter, falling 31.73% as against Sensex's 3.84% rise.
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The small-cap company has an equity capital of Rs 432.43 crore. Face value per share is Rs 2.
Suzlon Energy said it entered into an agreement with China's Poly LongMa Energy (Dalian), a conglomerate focused on conventional and green energy investments, to divest 75% stake in its China-based manufacturing subsidiary Suzlon Energy Tianjin (SETL) for $28 million. Suzlon in a statement said the first tranche of the payment has already been completed.
Suzlon Group will continue to own 25% share in the company and participate in its operations as joint venture (JV) partner. Thereafter, Poly LongMa Energy (Dalian) will lead marketing and sales operations in China, with Suzlon acting as technology partner with its existing China portfolio - including the S66-1.25 megawatts (MW), S82-1.5 MW and S88-2.1 MW turbines, and manage manufacturing and quality for the venture.
Speaking on the development, Mr. Tulsi Tanti, Chairman, Suzlon Group said, "This is an important step forward for our future business in China. With this joint venture, we monetize an asset we have built up from 2006, and through our partner, Poly LongMa Energy (Dalian), maintain our strong presence in the world's largest market, which remains strategically important for us. With the combined strength of both groups, the new joint venture will be very well positioned in China, and offer the potential to explore exports as well."
"While this deal has taken time and changes to fructify, we believe this achieves the best possible balance for the Group and our stakeholders, including our customers, vendors, lenders and employees," Mr. Tanti added.
Before trading hours on Wednesday, 18 September 2013, Suzlon Energy said that its UK-based subsidiary, REpower UK, signed four new turbine contracts in the UK. Financial details were not disclosed.
Last week, Suzlon Energy said its subsidiary, REpower Systems SE, won an order to supply 24 wind turbines in France. REpower Systems SE signed a contract with Valorem for 24 wind turbines of type MM92 with 80 metres hub height and a rated power of 2 megawatts (MW) to be supplied to four windfarms located in French Picardie, Pays de la Loire and Burgundy regions. REpower will also provide the full maintenance of the windfarms for 10 years, Suzlon Energy said in a statement.
Suzlon Energy reported consolidated net loss of Rs 1058.90 crore in Q1 June 2013, higher than a net loss of Rs 848.97 crore in Q1 June 2012. Net sales declined 18.9% to Rs 3851.45 crore in Q1 June 2013 over Q1 June 2012.
The Suzlon Group is ranked as the world's fifth largest wind turbine supplier, in terms of cumulative installed capacity and market share, at the end of 2012.
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