Emami acquires 26% stake in Axiom Ayurveda; stock zooms 7%

Shares of Emami, the homegrown FMCG maker, on Friday, September 29, surged as much as 7 per cent, thereby gaining for the second straight session. The uptrend in the stock came after it announced the acquisition of a 26 per cent stake in Axiom Ayurveda.

"This is to inform you that the Company has entered into definitive agreements today to acquire 26 per cent of the shareholding of Axiom Ayurveda Private Limited (“Axiom”) on a fully diluted basis, which owns the brand “Alofrut” - a proprietary fusion of aloe vera pulp with fruit blend," the regulatory filing read.

At around 1:36 p.m., shares of Emami Ltd were up 4.16 per cent on the BSE at Rs 548.55 apiece. The market capitalisation of the company stood at Rs 23,737.03 crore. The stock ended over 5 per cent higher at Rs 538.35 apiece.

What do analysts suggest?

Zee Business panellist Kunal Saraogi has recommended holding positions in the stock and keeping the stop loss of Rs 505-Rs 506. The expert, however, has denied fresh buying.

The stock has breached the target price of Rs 534 apiece given by Varun Dubey, Senior Research Analyst, Zee Business.

Emami Q1 results

Emami reported a consolidated net profit of Rs 137.7 crore for the first quarter of the current financial year (Q1FY24), an increase of 86.5 per cent compared with the corresponding period a year ago.

Its revenue grew 6.8 per cent on a year-on-year (YoY) basis to Rs 825.7 crore, according to a regulatory filing.

Emami share price: Past performance

So far in 2023, the stock has gained over 25 per cent against the headline index's rise of over 8 per cent.

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