Mega market player acquires additional stake worth Rs 54 crore; do you own it?
The company has consistently maintained a respectable dividend payout of 58.4 per cent.
On June 26, 2023, the shares of Asian Paints Limited surged 0.5 per cent, the shares are currently trading in green at Rs 3305.85 per share on BSE. On the BSE, the stock's 52-week high and low are Rs 3,590 per share and Rs 2,677.65 per share, respectively.
The company acquired additional stake in Obgenix Software Private Limited (brand name White Teak).
Asian Paints purchased an additional 11 per cent of White Teak's equity share capital from the promoters for about Rs 54 crore. In April 2022, the business paid Rs 180 crore for 49 per cent of the equity share capital of Obgenix Software Private Limited from Mr. Pawan Mehta and Mr. Gagan Mehta, the promoters of White Teak. White Teak has become a subsidiary of Asian Paints, with the firm now owning 60 per cent (2,40,600 equity shares with a face value of Rs 10 each) of White Teak's equity share capital.
Asian Paints gave the promoters of White Teak an earn out of Rs 59.5 crore (roughly) based on the achievement of mutually agreed financial goals. The remaining 40 per cent of the equity share capital would be bought over the fiscal year 2025-2026 for a maximum consideration of Rs 360 crore, according to Asian Paints.
White Teak is a private limited firm that designs, trades or otherwise deals in all varieties and descriptions of ornamental lighting goods and fans, etc.
Asian paints ltd. has a solid track record of return on equity (ROE): ROE over three years is 26.1 per cent. Furthermore, the company has consistently maintained a respectable dividend payout of 58.4 per cent.
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The Asian Paints group, founded in 1942, is India's largest paint company, also producing varnishes, enamels, or lacquers, surfacing preparation, organic composite solvents and thinners. It has operations in 15 countries and 26 paint manufacturing plants worldwide, supplying customers in over 60 nations.
The stock has witnessed significant buying activity as it has given returns of more than 19 per cent in just one year. Investors should keep a close eye on this large-cap paints stock.