Stock Rises As Raymond To Buy A 59.25% Interest In MPPL To Enter EV Components Businesses

Following the company’s announcement that it will enter the early stages of the aerospace, defense, and electric vehicle components industries, Raymond shares saw a 2.28% increase in value on Friday, closing at Rs 1,856 per share. The Raymond Group reported on Friday in an exchange filing that it had acquired a 59.25% share in Maini Precision Products Limited (MPPL) for a sum of Rs 682 crores, which was paid by a combination of internal accruals and debt.

With a complementary company that operates in the emerging industries of aerospace, electric vehicles (EVs), and defense, Raymond’s current engineering business will be further strengthened with this acquisition, which is viewed as a strategic move. The combined company serves the leading global original equipment manufacturers (OEMs) and Tier 1 producers in the automotive, aerospace, defense, and industrial sectors.

Raymond
Credit: Goodreturns

Raymond’s engineering business will become a large-scale provider of automotive, EV, aerospace, and defense components with this acquisition. It will also be uniquely positioned to target high-growth precision engineering products with a significant presence in both domestic and international markets. 

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Raymond’s intentions for the future: after the acquisition, he will create a new company called “Newco” by combining the operations of JK Files, RPAL, and MPPL. The “Newco” will be 66.3% owned by Raymond Ltd. and will concentrate on precision engineering products. As of FY23, “Newco” had a proforma consolidated revenue of about Rs 1600 crore and an EBIDTA of about Rs 220 crore.

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