Bajaj Electricals snaps 4-day losing run; stock jumps 13% on Morphy Richards acquisition

Shares of Bajaj Electricals Ltd jumped 13 per cent in Wednesday’s trade, snapping its four-day losing run after the company said that the board has approved the acquisition of the Morphy Richards brand in India and neighbouring markets.

On Wednesday, Bajaj Electricals shares surged as much as 13.2 per cent to hit a day’s high of Rs 653.60 on the BSE, up from Tuesday’s close of Rs 576.95. By 10:07 am, the stock was trading 10.25 per cent higher at Rs 636.10, valuing the company at Rs 7,338 crore. So far, a total of 4.79 lakh shares had changed hands, generating a turnover of Rs 30.58 crore.

In a Tuesday filing, after market hours with the stock exchanges, the consumer durables company said its board had cleared the purchase of the Morphy Richards brand and related intellectual property rights for Rs 146 crore from Glen Electric Ltd, part of the Ireland-based Glen Dimplex Group

The acquisition covers India, Nepal, Bhutan, Bangladesh, the Maldives and Sri Lanka. Bajaj Electricals, which has been the exclusive licensee of Morphy Richards products in India for over two decades, will now own the brand outright in these territories.

The company also said that further disclosures will follow upon execution of agreements and completion of milestones.

At current levels, the stock trades 30 per cent above its 52-week low of Rs 487.60, while remaining 36 per cent below its 52-week high of Rs 995. The scrip has fallen in four of the last five trading sessions.

Technically, the stock is positioned above its 5-, 10-, 20-, 30-, 50-, 100- and 150-day simple moving averages (SMAs), but remains below the 200-day SMA.