India Cements slumps 6% as investors not impressed with stake sale
According to an exchange filing by India Cements, it has divested entire stake in SMPL to JSW Cement for Rs 476.87 crore.
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03:05 PM IST
India Cements, NSE: INDIACEM, stock dropped on Tuesday as investors were unimpressed by the company's decision to sell a non-core asset. The bearish sentiment in the counter came on account of the company's announcement to divest its entire stake in wholly-owned subsidiary Springway Mining Private Ltd (SMPL) to JSW Cement. At 11 AM, the stock was quoting a price of Rs 260 apiece on the NSE, down by nearly 5.50 per cent.
According to an exchange filing by India Cements, it has divested entire stake in SMPL to JSW Cement for Rs 476.87 crore. JSW Cement is a subsidiary of industrialist Sajjan Jindal-controlled JSW Group.
Of the total consideration, India Cements has already received Rs 373.87 crore, according to the filing. It will receive the remaining Rs 103 crore on/before December 31, 2022, following completion of certain conditions.
The deal is expected to be completed by the end of this year.
“The company has entered into a Share Purchase Agreement on October 10, 2022, with JSW Cement Limited (Buyer) and divested the entire shareholdings held by it in SMPL, for a total consideration of Rs 476.87 crore," India Cements said in the filing yesterday.
JSW Cement, part of the diversified USD 22 billion JSW Group, has a current capacity of 17 million tonnes per annum (MTPA). It plans to have 25 MTPA production capacity by 2023 and is driving investments to achieve this goal. South-based ICL has a total capacity of 15.5 MTPA.
India Cements stock has delivered a stellar return of around 20 per cent in the past month while around 30 per cent year to date. The 52-week range of India Cements stock is Rs 298.95 - Rs 145.45.
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