Vikas EcoTech shares rebound 5% after board okays merger proposal

Shares of Vikas EcoTech rebounded more than 5 per cent during the early trading session on Monday after the company board gave its in-principal approval for its merger. The company board informed about the same, through an exchange filing after its board meeting held earlier in the day.

The company board gave its nod for evaluating consolidation proposal of the company with Vrindaa Advanced Materials and appointed Price Waterhouse & Co LLP, a Big4 advisory firm for the evaluation of consolidation proposal from tax and regulatory perspective, said the company in the exchange filing.

Incorporated in 2007, Vrindaa Advanced Materials (VAML) is engaged in the business of speciality polymer compounds, agri products trading.  The company is headquartered at New Delhi and has a manufacturing facility at Vigyan Nagar, RIICO Industrial Area, Shahjahanpur, Rajasthan, the filing added.

Following the update, shares of Vikas EcoTech rebounded 5 per cent from the initial cuts to trade at Rs 3.59 from Rs 3.41 on Monday, with a total market capitalization of more than Rs 460 crore. The scrip had settled at Rs 3.54 in the previous trading session on Friday.

Despite a 13 per cent fall in the last one month, shares of Vikas EcoTech have delivered a return of 35 per cent in the last six-month period. However, the stock remains mostly flat, marginally up, in the last one year and on a year-to-date (YTD) basis.

VAML registered total income of Rs 192.51 crore with a net profit of Rs 9.35 crore for the financial year ended March 31, 2023, said the exchange filing with the bourses. The company debt free company with a positive net worth of Rs 69.14 crore as on March 31, 2023, it added.

About a month ago, Vikas EcoTech recently raise Rs 50 crore via qualified institutional placement (QIP) route, when it approved allotment of 16,12,80,000 equity shares at the issue price at Rs 3.10 per equity share to the eligible buyers including Radiant Global Fund, Forbes EMF and Minerva Ventures Fund.

Vikas Ecotech is engaged in the business of specialty polymers for applications in sectors like electrical, infrastructure, packaging, and automotive, among others. The New Delhi-based company had recently concluded fund raising to reduce debt from its books.

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