Shalimar Paints spikes 11 per cent on right issue and reestablishment of plant

Shalimar Paints informed the bourses on Tuesday that the company's board of directors have approved right issue up to Rs. 240 crore.

Notably, the company also informed the exchange about the reestablishment of its Nashik Plant and the establishment of a new regional distribution centre at Nashik Plant.

This plant caught fire in the year 2016 and since then the plant was not in operation. Production from this plant generated sales of almost 40 per cent for the decorative segment and 60 per cent for Industrial paints. Before the fire accident, the average production at the plant was around 1,400 KL/ month.

Thus, this is a positive development for the stock of Shalimar Paints, which surged almost 11 per cent to touch the day's high of Rs. 141.7 in the early morning session. At 11.37 hours on Wednesday, the stock was trading at Rs. 136.4, up by 6.4 per cent from its previous close.