Penny stock under ₹5: Nandan Denim share price will remain in focus in Monday’s trading session after the company announced the acquisition of a stake in Opera Vayu (Narmada) Private Limited.
On Friday, the penny stock ended the session around 3% higher, closed at ₹2.71 apiece.
Nandan Denim stake acquisition details
In an exchange filing on Friday, Nandan Denim said that the board has approved the acquisition of a 6.1% equity stake in Opera Vayu (Narmada) Private Limited, a special purpose vehicle set up for renewable energy generation.
“The board considered and approved to enter into a Share Transfer cum Shareholders’ Agreement with the Special Purpose Vehicle i.e. M/s. Opera Vayu (Narmada) Private Limited (“SPV”), and Shivman Wind Energy Private Limited (Promoter and Project Implementer) for purchase of wind & solar power under the applicable captive power route and in this connection, the Company will be acquiring 6.1% (out of 26% of user members as required under Electricity Act, 2003 Group Captive Renewable Energy Power plant) equity shareholding in the said SPV,” the company said in the filing.
As part of the deal, the company will invest ₹4,00,20,960 to purchase 40,02,096 equity shares with a face value of ₹10 each. The acquisition is being carried out under the captive power route, with Nandan Denim participating as a user member.
Additionally, the company will furnish an irrevocable bank guarantee of ₹1.90 crore to cover three months of power billing. The transaction will be executed in cash and does not fall under the related party category.
“The Company has been exploring the possibility of increasing the Sourcing of Renewable Power to reduce the cost of power at its Bareja Plant. In this connection, the Company (User Member under the Captive Power Route) shall procure 4.3 MW Power out of 23.1 MW (Wind & 25 MW DC Solar) of Group Captive Renewable Energy Power Plant,” the company said in the filing.
The company further said that this acquisition would enable it to obtain Wind & Solar Power from SPV at a highly competitive market rate for a period of 25 years.
Nandan Denim share price trend
The penny stock has remained volatile in the near term amid weak market sentiments. Nandan Denim share price has gained 4.63% in a week and over 20% in a month.
However, the stock has shed 33.42% in the last one year and 7.51% in year-to-date (YTD) basis.
Zooming out further, the penny stock has delivered 24.31% returns in the last three years, meanwhile, has fallen 12.30% in five years.
Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.
