Kwality surges after receiving funding commitment from PE fund

Kwality has surged almost 5% to Rs 116.40 on the BSE after the company said it has received capital commitment of upto Rs 520 crore via structured finance from private equity fund KKR India to fuel its aggressive growth plans.

On BSE, so far 2.52 lakh shares were traded in the counter as against average daily volume of 1.81 lakh shares in the past one quarter. The stock hit a high of Rs 117.90 and a low of Rs 114.50 so far during the day. The stock had hit a 52-week high of Rs 153.70 on 28 December 2015.

The stock had hit a 52-week low of Rs 62.40 on 26 August 2015. The stock had underperformed the market over the past one month till 12 July 2016, gaining 0.82% compared with the Sensex's 4.4% rise. The scrip had also underperformed the market in past one quarter, declining 5.24% as against Sensex's 10.59% rise.
 

Kwality said it has received capital commitment of upto Rs 520 crore via structured finance from KKR India, one of the biggest private equity (PE) fund, to fuel the company's aggressive growth plans as it continues to rapidly shift its business model towards B2C/retail segment.

The proceeds shall be utilized to fund capex to further strengthen milk procurement infrastructure solely for high-margin value-added product categories including cheese, paneer, table butters, tetra-packs, flavoured milk and yoghurt among others.

The company intends to roll out a series of such products in the near future, Kwality said. Additionally, funds will be deployed for part repayment of debt to improve cash flows and augment brand building activities.