Alicon Castalloy Stock: THIS small-cap auto ancillary company's shares surge 30% in two sessions as MFs pick stake

The shares of Alicon Castalloy hit an upper circuit of 20 per cent and touched a new life high of Rs 761.75 on the BSE during Friday’s trade as the mutual funds bought nearly 10 per cent stake in the company through qualified institutional placement (QIP) issue.

The counter of this auto parts and equipment firm spurted 30 per cent on the BSE in the last two sessions, as compared to 0.1 per cent rise in the S&P BSE Sensex.

See Zee Business Live TV Streaming Below:

The company raised around Rs 80 crore by allotment of almost 1.5 million equity shares to eligible qualified institutional buyers (QIBs) at the issue price of Rs 540 per share, the company said in its filing to exchanges on Thursday. The QIP opened on June 25, 2021, and closed on June 30, 2021.

The mutual funds bought 1.48 million shares or 9.51 per cent stake in Alicon Castalloy as per the shareholding pattern for the period ended June 30, 2021,, the company said in another exchange filing. The mutual funds held 0.17 per cent holding at the end of March 31, 2021 quarter, data shows.

Axis Mutual Fund Trustee Ltd. A/c Axis Mutual Fund A/c Axis Small Cap Fund (4.75 per cent), Aditya Birla Sunlife Trustee Private Limited A/c Aditya Birla Sun Life Multi-Cap Fund (2.62 per cent) and IDFC Emerging Business Fund (2.14 per cent) have bought over 2 per cent stake each in the firm.

The company aims to use net proceeds for repayment of debt of the company, and general corporate purposes, or any other purposes.

Alicon Castalloy mainly caters to three business segments (automotive segments; non-automotive segment; and e-mobility). The company may be benefit from sustained domestic auto demand driven by new launches, pent-up demand and a preference for personal mobility.