New Delhi-based specialty polymers, additives, and chemicals firm, Vikas EcoTech Ltd. (BSE:VIEC), has revealed its intention to wholly acquire a plasticizer manufacturing business by December 2023. The enterprise value of the acquisition is slated at Rs. 27 crore.
On the same day, Vikas EcoTech also issued 10 crore fully convertible warrants to its promoter, Vikas Garg. Each warrant is priced at Rs. 3.40 and requires an upfront payment of a quarter of the total amount, with the remaining balance due upon conversion into equity shares within an 18-month timeframe.
These strategic decisions have resulted in a significant boost for Vikas EcoTech's shares, which hit an upper circuit of 5 percent. This surge has pushed the company's market capitalization beyond Rs. 450 crore, marking approximately 30 percent growth in its stock value over the past six months.
As a multifaceted firm, Vikas EcoTech serves a variety of sectors including agriculture, infrastructure, packaging, electrical, footwear and automotive. The acquisition of the plasticizer manufacturing business is expected to further bolster its product offerings across these diverse industries.
InvestingPro Insights
In light of the recent developments at Vikas EcoTech Ltd., InvestingPro offers a couple of pertinent insights that could be beneficial for potential investors.
Firstly, Vikas EcoTech's strategic decisions, which include the acquisition of a plasticizer manufacturing business and the issuance of fully convertible warrants, align with InvestingPro Tip 0, which highlights the potential for a high return on invested capital. This tip is particularly relevant given the company's recent surge in share value and market capitalization.
Secondly, InvestingPro Tip 12 is worth noting. This tip underscores the significance of a large price uptick over the last six months, which Vikas EcoTech has indeed experienced with approximately 30 percent growth in its stock value.
For more insightful tips, investors are advised to explore the InvestingPro platform, which offers a wealth of additional tips tailored to individual companies. For instance, Vikas EcoTech has 13 more tips available on InvestingPro, offering a comprehensive understanding of the company's financial health and investment potential.
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