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Shares of VIP Industries rise 7% on Advent deal rumours

Stocks
2 min Read Nov 22, 2024
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Shares of VIP Industries surged 7% on Thursday, hitting an intraday high of ₹492.45 on the Bombay Stock Exchange (BSE). The rally followed reports of global private equity firm Advent International entering discussions to acquire a controlling stake in the company. Investors looking to invest in stocks have taken note of this development.

Market performance on Thursday

By 11:57 AM, VIP Industries' shares rose 6.25%, trading at ₹488.7. In contrast, the BSE Sensex slipped 0.64% to 77,082.53. The company’s market capitalisation was ₹6,940.2 crore. Over the past year, its stock traded between a 52-week high of ₹668.1 and a low of ₹427.55.

Revival of stake sale talks

The current discussions with Advent International mark the revival of sales talks initiated a year ago. Reports suggest the promoters, holding a 51.74% stake in VIP Industries, have offered their entire share for sale. If the deal proceeds, regulatory guidelines could trigger an open offer.

Financial performance in Q2

VIP Industries reported a consolidated loss of ₹38.5 crore in Q2, significantly higher than the ₹2.43 crore loss a year ago. The revenue from operations stood at ₹543.94 crore, marginally higher than last year’s ₹538.1 crore. The total income for the quarter was ₹546.82 crore, compared to ₹541.05 crore in the same period last year.

About VIP Industries

Founded in 1971 and headquartered in Mumbai, VIP Industries is a leading Indian manufacturer of luggage and travel accessories. Its portfolio includes well-known brands like VIP, Skybags, Aristocrat, and American Tourister. The company exports to over 50 countries, maintaining a strong global presence. Its focus on innovation and advanced materials has made it a key player in the luggage market.

Stock performance over the past year

Despite Thursday’s gains, VIP Industries shares have declined 21% over the last year, underperforming the Sensex, which has risen 18%. Investors seeking to invest in stocks may view the potential acquisition as a strategic turnaround opportunity.

Key takeaways

  1. VIP Industries' shares surged 7% following acquisition rumours.

  2. The promoters are reportedly selling their entire 51.74% stake.

  3. Q2 results showed widened losses despite stable revenue.

  4. The company exports to 50+ countries and focuses on innovation.

  5. Its shares have dropped 21% over the last year, presenting a mixed outlook for those planning to invest in stocks.

With ongoing developments, VIP Industries remains a stock to watch for those aiming to invest in stocks strategically.