Prestige Estates Projects rose 4.27% to Rs 313.45 at 10:42 IST on BSE after the company said it will acquire 66.66% stake in a group company, Prestige Projects, for Rs 324 crore.
The announcement was made after market hours yesterday, 26 December 2017.Meanwhile, the S&P BSE Sensex was up 92.49 points, or 0.27% to 34,103.10.
On the BSE, 34,000 shares were traded in the counter so far, compared with average daily volumes of 23,000 shares in the past two weeks. The stock had hit a high of Rs 316 and a low of Rs 310.15 so far during the day. The stock hit a record high of Rs 346 on 1 December 2017. The stock hit a 52-week low of Rs 148 on 14 March 2017.
Prestige Projects (PPPL) was formed on 13 June 2008 and is an associate of Prestige Estates Projects. Prestige Estates Projects currently holds 33.34% stake in PPPL. PPPL is in the business of real estate development and owns a land parcel admeasuring over 180 acres located in Sarjapur road, Bengaluru.
The company is proposing to develop a large scale affordable and mid income housing project (approximately over 7.5 million square feet of developable area) comprising of apartments, villas and plots along with various lifestyle amenities and necessary social infrastructure such as retail shopping malls, sports facilities etc. in this land.
PPPL has not registered any business turnover for the last three financial years, as the project is under various stages of planning and regulatory approvals.
Prestige Estates Projects through a wholly-owned special purpose vehicle (SPV) is in the process of acquisition of 66.66% equity stake in PPPL from the investors and land owners for a consideration of approximately Rs 324 crore. The acquisition is expected to be completed before 31 January 2018. Currently, investors hold 33.33% stake and land owners hold 33.33% stake in PPPL.
The transaction is in the ordinary course of business and is being done at arm's length. The above said proposal is being mooted for business reasons.
On a consolidated basis, Prestige Estate Projects' net profit rose 1.11% to Rs 90.70 crore on 4.66% decline in net sales to Rs 1098.10 crore in Q2 September 2017 over Q2 September 2016.
Prestige Estates Projects is engaged in the business of real estate development.
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