Mirza International shares rallied 71% in 5 days. Here's why

Shares of Mirza International soared 10 per cent in Thursday's trade to take its 5-day winning run to 71 per cent. The scrip has been rising ever since the stock went ex-demerger this past month.

To recall, the promoter group-owned entity RTS Fashions was merged with Mirza International recently. Later, the amalgamated Mirza International, which manufacturers and markets leather footwear and finished leathers, de-merged its branded business into Red Tape, whose ex-date was March 29. The Mirza International stock is now trading ex-Red Tape and the demerged Red Tape will soon be listed on stock exchanges.

As per a Mirza International filing on April 15, the net worth of the company immediately before demerger was Rs 726.91 crore. The net assets of demerged undertaking stood at Rs 301.46 crore.

On Thursday, the Mirza International stock hit its upper circuit limit at Rs 54.91 apiece. The company commanded a market capitalisation of Rs 759 crore. It surged 20 per cent on Wednesday, 17.61 per cent on Tuesday and 7 per cent each on Monday and Thursday.

Red Tape, on the other hand, approved the allotment of 13,82,01 ,900 shares of face value of Rs 2 each of Red Tape, credited as fully paid up to the equity shareholders of the Transferee Company - Mirza International, in the 1:1 share exchange ratio.

Apart from supplying products to global retailers, Mirza had in-house brands Red Tape and Oaktrak - in its portfolio. As per a report, Red Tape accounted for nearly 70 per cent of the combined company revenues and about 80 per cent of profit in the first nine months.

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