Multibagger Stock: Watch Component Manufacturer Acquires 8,74,000 Partly Paid-Up Shares of Swiss Watch Firm Silvercity Brands AG

The company boasts market capitalisation of Rs 3,825 crores, with a notable 1-year return of 24.22 per cent and a 3-year return of 232.36 per cent.

KDDL Limited, a notable player in the watch and luxury goods sector, has made a strategic acquisition through its wholly-owned subsidiary, Mahen Distribution Limited. The company has acquired 8,74,000 partly paid-up equity shares of Silvercity Brands AG, a Swiss watch corporation. This acquisition, conducted at an arms-length transaction, involves a cash consideration with shares acquired at CHF 2.86 each.

Silvercity Brands AG, incorporated in March 2023, focuses on the watch industry, dealing in intellectual property rights, marketing, and development of luxury products. This acquisition aligns with KDDL's strategic objectives to invest in or create brands and expand its footprint in the luxury watch market. KDDL's involvement in Silvercity Brands AG is significant, as it directly and indirectly holds a 93.07 per cent equity stake in the Swiss company.

This move is part of KDDL's broader strategy to enhance its presence in the luxury segment, leveraging its existing retail chain, Ethos, which offers a wide array of premium watch brands. The acquisition underscores KDDL's commitment to expanding its portfolio and strengthening its position in the luxury watch market.

As of 19 March 2025, KDDL's stock is trading at Rs 3,051. The stock's 52-week high is Rs 3586.4, and the 52-week low is Rs 2129.2, indicating that it is trading near its 52-week low. This multibagger stock has delivered 2,229 per cent returns over the past 5 years.

KDDL Limited, established in 1981, is a prominent manufacturer of watch components, including dials and hands, under the brand Eigen. The company operates India's largest luxury watch retail chain, Ethos, offering over 60 premium brands. This segment has seen substantial growth, driven by digital initiatives and portfolio expansion.

DDL also manufactures precision engineering goods and has a strong presence in both India and Switzerland. The company has been expanding its retail footprint, now operating 63 stores across 24 cities in India. Recent strategic moves include the acquisition of the Swiss watch brand Favre-Leuba and the establishment of new manufacturing facilities. KDDL is focused on expanding its product range and increasing its market share in precision engineering, aiming for a revenue growth of 20 per cent-25 per cent CAGR over the next few years.

KDDL Limited boasts a market capitalization of Rs 3,8025 crores, with a notable 1-year return of 24.22 per cent and a 3-year return of 232.36 per cent.

As of December 2024, the shareholding pattern is as follows: Promoters hold 50.44 per cent, FIIs hold 9.33 per cent, DIIs hold 1.71 per cent, the government holds 0.11 per cent, and the public holds 38.42 per cent. There is a notable decline in FII holdings from 11.69 per cent in June 2024 to 9.33 per cent in December 2024, while public shareholding has increased from 36.34 per cent to 38.42 per cent over the same period

The company has ROCE of 18.6 per cent and ROE of 17.2 per cent. The company has been maintaining a healthy dividend payout of 31.10 per cent.

Investors must keep this Small-Cap stock on their radar.

Disclaimer: The article is for informational purposes only and not investment advice.