Penny stock under ₹10: Axita Cotton share price will remain in focus in Monday’s trading session after the company a new update on participation in the Corporate Insolvency Resolution Process (CIRP).
The small-cap penny stock closed 5% higher at ₹7.68 apiece on Friday. During the session, the stock touched an intraday high of ₹7.90 and intraday low of ₹7.30.
Axita Cotton’s business update
In an exchange filing dated 21 August, Axita Cotton said that the company has submitted Expression of Interest for participation in the Corporate Insolvency Resolution Process (CIRP) of Varidhi Cotspin Private Limited.
Varidhi Cotspin Private Limited (Varidhi) is a manufacturer of cotton yarn located in Dholka, Ahmedabad, Gujarat and having its Manufacturing Unit established in 2017. Varidhi is having a spinning facility housing 29,184 spindles featuring a spinning unit capacity of roughly 4,442 metric tonnes per annum (MTPA). Its produce Ring Spun 100% Cotton, Compact, Combed, Carded Yarn for hosiery and weaving industries.
The company further said that it is keen to acquire Varidhi Cotspin Private Limited through the Insolvency and Bankruptcy Code (IBC) process, which is expected to complement the Company’s existing operations and support its long-term business expansion strategy by strengthening its presence across the cotton value chain.
Axita Cotton Limited has established itself as a quality-focused cotton manufacturer and exporter, with a strong emphasis on quality, timely delivery, customer satisfaction, innovation and sustainability. The company’s established presence in the cotton industry provides a strong foundation to explore opportunities in complementary segments of the textile value chain.
The proposed participation in Varidhi’s CIRP presents a strategic opportunity for Axita Cotton Limited to broaden its operations and explore potential synergies in the cotton and yarn manufacturing segments.
Axita Cotton share price trend
Axita Cotton share price trend has remained volatile amid weak market sentiments. The small-cap penny stock has gained 5.35% in a week and 3.5% in a month.
Furthermore, the penny stock has slipped 19% in six months and 32% on year-to-date (YTD) basis.
Looking at the broader level, the stock has delivered a loss of 42% in three years, however, has given multibagger returns of 269% in five years.
Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.
