Intraday Spotlight: Shares of Varroc Engineering rises 5 per cent on strategic partnership interest

Intraday Spotlight: Shares of Varroc Engineering rises 5 per cent on strategic partnership interest

Anthony Fernandes
/ Categories: Trending, Mindshare

The automotive component maker has received interest from certain parties for a strategic partnership in the Global Lighting Systems business.

Shares of Varroc Engineering were among the top gainers on the S&P BSE 500 intraday trading up by 5.75 per cent in the afternoon trading session on Tuesday after the company stated in its results filing to the BSE that it has received interest from certain parties for a strategic partnership in the Global Lighting Systems business. 

During Q3FY22, the company’s revenue from operations stood at Rs 3134.95 crore, a decrease of 10.24 per cent over Q3FY21 due to semiconductor shortage, soft 2W demand and Euro weakness. The company’s operational performance was impacted due to high commodity prices and as a result, PBIDT (Ex OI) was down 84.20 per cent to Rs 35.75 crore, whereas, the company reported a net loss of Rs 267.52 crore in Q3FY22. With improving chip supply and cost savings, the company’s fundamentals should see improvement from present levels, driving deleveraging. 

A key highlight in the press release was CMD’s statement which said that the company had received interest from certain parties for a strategic partnership in its Global Lighting Systems business, and the management was in the process of evaluating their interest in the same with respect to scope, valuation, timelines, etc.

Varroc Engineering engages in the manufacture and supply of automotive components. Its products include polymer, electrical electronics, metallic, and lighting systems.  

At 1.50 pm on Tuesday, the stock of Varroc Engineering pared some of its gainers seen earlier in the day and was seen trading at Rs 392.90, up by 3.87 per cent or Rs 14.65 per share. The 52-week high of the scrip is recorded at Rs 458.30 and the 52-week low at Rs 260.20 on the BSE.   

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