Ugro Capital Shares Jump On Plans To Acquire Profectus Capital

Ugro Capital Ltd.'s share price jumped 8% after its board approved plans to acquired Profectus Capital Pvt., in a bid to expand its presence in the MSME-lending space.

The Mumbai-based non-banking financial company is buying 100% stake in Profectus Capital for Rs 1,400 crore. The entire transaction will happen in cash in single tranche. The deal will take next two-to-three months to conclude, the company said in the exchange filing.

Ugro Capital will fund the transaction through the proceeds of issuance of convertible debentures, and internal accrual. In this regard, the company issued compulsorily convertible debentures on preferential basis in late May, as per the exchange filing.

Ugro Capital's share price advanced 7.89% to Rs 185 apiece. It pared gains to trade 3.52% higher at Rs 178.01 apiece as of 9:56 a.m., as compared to a 0.23% advance in the Nifty 50.

The stock declined 32.76% in 12 months, and 21.23% year-to-date. Total traded volume so far in the day stood at 18 times its 30-day average. The relative strength index was at 53.90.

Six analysts tracking the company maintain a 'buy' rating, according to Bloomberg data. The average 12-month consensus price target implies an upside of 48.1%.