Dhunseri Tea shares rally 18% on acquisition of two tea estates

Shares of Dhunseri Tea & Industries climbed 18 per cent in Tuesday's trade after the company said it has acquired Budlabeta Tea Estate and Hapjan Tea Estate from Apeejay Tea located in Tinsukia District of Assam in a bid to enhance production, turnover and profitability. Before this, the company had entered into a deal with Warren Tea to buy its four tea estates in Assam.

Following the fresh development, the stock rose 17.67 per cent to hit a high of Rs 261 on BSE. With this, the scrip has climbed 31 per cent in the last one month. Also, the stock is up 47 per cent from its 52-week low of Rs 177.10 hit on June 21.

In a BSE filing, Dhunseri said the company has signed a memorandum of understanding (MoU) with Apeejay Tea for acquisition of two tea estates located in Tinsukia district of Assam for Rs 109 crore in cash consideration.

Recently, the company entered into MoU with Warren Tea to acquire three tea estates in Assam -- Duamara Tea Estate, Tara Tea Estate and Deohall Tea Estate. The objective of acquisition, it said, was to enhance production, turnover and profitability of the company. Duamara Tea Estate’s cost of acquisition stood at Rs 32.95 crore, Tara Tea Estate is Rs 36.50 crore and Deohall Tea Estate’s cost of acquisition is Rs 21.35 crore.

Dhunseri Tea & Industries is engaged in manufacture and sale of tea. It has been in the business of manufacture of tea for the last five decades. The company has eight other tea estates and 10 tea factories in Assam. It, through its subsidiary Dhunseri Petrochem & Tea, also has two tea estates in Malawi (South Eastern Africa ) where plantation of tea and macadamia are undertaken. The company’s tea packaging and blending units are located in Dhunseri Tea Estate (Assam) and at Jaipur (Rajasthan).

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