Shares of SML Mahindra Ltd. extended its rally for the second day as it hit upper circuit for the second consecutive day with the stock touching intraday high of Rs 5479.20 apiece on Thursday. The stock opened in positive 10.03% and extended further to hit upper circuit at 11:14 am.
Shares of SML Mahindra surged 20% on Wednesday after auto major Mahindra & Mahindra announced a restructuring exercise under which it will transfer the trucks and bus division to the firm for a Rs 525-crore consideration.
The deal will help SML, a listed entity with M&M owning nearly 59%, grow much faster by going to the market together, the company said in an exchange filing. The move will also help to exploit the synergies between the two businesses in a much better form and help in its profitability, the company said.
The aim is to become India's fourth-largest commercial vehicle maker with a wider array of offerings, and taking the revenue to Rs 12,500 crore by FY31, the filing said. Combined revenues of SML Mahindra and the truck and bus division stand at under Rs 6,000 crore, as per public disclosures.
The Mahindra group last year acquired a majority stake in what was then known as SML Isuzu, which has a stronger presence in the intermediate and light commercial vehicle segment, and renamed it as SML Mahindra.
The group's truck and bus division is stronger on the heavy commercial vehicles front. M&M will do contract manufacturing of heavy commercial vehicles for SML, as part of the arrangement, from its Chakan plant.
SML Mahindra Ltd. Share Price Today
SML Mahindra Ltd. Share Price Today
Photo Credit: (Photo: NDTV Profit)
The scrip rose as much as 20% to Rs 5479.20 apiece on Thursday at 11:14 a.m. This compares to a 0.04% fall in the NSE Nifty 50 Index.
It has risen 547820.00% in the last 12 months and 37.81% year-to-date. Total traded volume so far in the day stood at 0.09 times its 30-day average. The relative strength index was at 70.57.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
