Sintex Plastic to exit auto division; stock gains

Plastic moulding company Sintex Plastics Technology announced that it plans to sell its Auto division, on Wednesday. The stock reacted positively to the development and gained 4 per cent.

 The board of Sintex Plastics Technology approved the sale of Auto Division, Sintex-BAPL, the wholly-owned material subsidiary of the company. The company has constituted the ‘Auto Division Divestment Committee’ to examine and finalise the proposals including completing all legal requirements. The Board of Directors of the company at its meeting held on May 21, 2019 has approved the same. The company believes that this move will deleverage its balance sheet.

The company is looking to sell its domestic automotive custom moulding business as part of a debt reduction plan. Aurangabad-based Varroc Engineering is supposed to be in advanced talks with Sintex to acquire the unit.

Sintex Plastics Technology is a global conglomerate with a large and growing presence in the plastic processing sector. It operates through custom moulding solutions and building products and solutions divisions.

On Wednesday, the stock of Sintex Plastics Technology closed at Rs. 16.90, higher by 4.64 per cent on BSE.