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News Topical, Digital Desk : The company's shares experienced a sudden surge on Wednesday. The stock jumped more than 7% in morning trading. The reason was a major block deal, in which approximately 26% of the company's shares changed hands simultaneously. This transaction of approximately 37 million shares not only surprised the market but also clearly illustrates the ongoing changes in the company's ownership structure. The company has a market cap of ₹5,483 crore. In 2002, the share price was ₹2. In 2022, the share price reached ₹774. Now, the price is around ₹390.
The company is VIP Industries Ltd., India's largest luggage manufacturing company, established in 1971 and headquartered in Mumbai. The company manufactures luggage, backpacks, handbags, and travel accessories—hard/soft suitcases, trolley bags, school/college bags, etc., including the first 4-wheel trolley in India (2011), Tech Series (proximity indicator), and Workation Collection (laptop compatible). The biggest driver of this rally was a large block deal. According to market information, approximately 37 million shares, representing approximately 26% of the company's stake, were traded simultaneously. Such a large transaction typically occurs when a major change in a company's ownership structure is underway. However, the names of the buyer and seller in this deal have not yet been made public. Experts say the size of this block deal matches the size of the previously announced open offer. This open offer was brought by a consortium of Multiples Private Equity and its partners. It is believed that this deal could be part of the same process. Over the past few months, there has been constant activity regarding stakes in VIP Industries. In September, the promoters sold a 6.2% stake through a block deal. In this transaction, Piramal Vibhuti Investments and Kiddy Plast together sold approximately 8.84 million shares. The average price of these shares was ₹388.2 per share, and the total deal value was approximately ₹343 crore. In the same transaction, Multiples Private Equity Fund purchased approximately 6 million shares, valued at approximately ₹233 crore. Samvibhag Securities purchased 2.2 million shares for approximately ₹86 crore. An even larger deal occurred in July. At that time, Multiples Private Equity Fund IV, Multiples Private Equity Gift Fund IV, Samvibhag Securities, and promoter family members Mithun Sacheti and Siddhartha Sacheti jointly acquired a 32% stake from the promoter group. Following this deal, veteran promoter Dilip Piramal sold his controlling stake and retained approximately 20%. These buyers subsequently announced an open offer for a 26% stake, as required by regulations. The open offer price was set at ₹388 per share, which could have cost up to ₹1,437 crore. This entire transaction values the company at approximately ₹3,200 crore. Wednesday's rally clearly shows that the market is viewing this ownership change positively. However, it is also true that the stock is still under significant pressure on a year-on-year basis. Investors will be keenly watching the new investors' strategy for the company and any future changes in management.
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