Hindustan Composites to acquire stake worth ₹5.17 crore in Swiggy, stock rallies 9%

In a stock exchange notification on Monday, Hindustan Composites said that it has entered into a share purchase agreement to acquire 1.5 lakh equity shares of Swiggy of ₹1 each in an all-cash deal by making an investment of ₹5.17 crore.

This is equivalent to a 0.01% stake in the IPO-bound Swiggy Ltd. According to the stock exchange filing, Hindustan Composites targets completing this acquisition by November 30, 2024.

“The equity shares acquired shall form part of the company's investment with a view to gaining long-term/short-term investment benefits,” the company informed the bourses.

After the announcement, the Hindustan Composites stock jumped as much as 9.16% to hit an intraday high of ₹633.95 on the NSE in morning deals on Tuesday. By 3:00 pm, the stock erased some of its gains to trade higher by 4.41% at ₹606.3 apiece.

Year-to-date, Hindustan Composites shares have gained nearly 35% and more than 39% in the last one year. The stock has rallied more than 45% in the past six months while rising 4% in the past one month.

Hindustan Composites is engaged in the development, manufacturing and marketing of friction materials comprising brake lining, clutch facing, disc brake pad, roll lining and brake block.

Swiggy was in the news last week after reports emerged that movie actor Amitabh Bachchan’s family office has picked up a minority stake in the company from its employees and early backers for an undisclosed amount.

Food delivery major Swiggy operates as a marketplace for ordering and delivering food. The company also offers online grocery delivery and same-day package delivery services.

According to reports, Swiggy is planning for a $15 billion valuation for its public issue. It’s one of the much-awaited public offers of the year as the Softbank-backed food delivery firm is likely to launch its initial public offering (IPO) to raise around ₹ 8,500-10,000 crore. Shareholders of the company had approved the Swiggy IPO in April 2024.