GMM Pfaudler plunges 18% after over 11 mn shares change hands in block deal

Shares of GMM Pfaudler plunged 18 per cent to Rs 1,576.10 on the National Stock Exchange (NSE) and Rs 1,575 on the BSE after over 11 million equity shares of the company changed hands on the bourses via block deals. 

Till 09:30 AM, a combined around 11.18 million shares, representing nearly 25 per cent of the total equity of the company, had changed hands on the NSE and BSE, data from the exchanges shows. The names of the buyers and sellers could not be ascertained immediately. By comparison, the Nifty 50 and the S&P BSE Sensex were down 0.2 per cent at 9:50 AM.

According to media reports, Pfaudler Inc, a promoter of GMM Pfaudler, was looking to sell a majority of its stake in the company in a block deal that will likely fetch the shareholder Rs 2,278 crore.

"Pfaudler Inc will sell 13.4 million shares of the company, representing 29.88 per cent stake, at a floor price of Rs 1,700 apiece, which is a 11.67 per cent discount to the company's closing price on Thursday," Mint reported.

As on September 30, 2022, Pfaudler Inc held 14.33 million shares or 31.88 per cent stake in GMM Pfaudler, shareholding pattern data shows.

GMM Pfaudler delivers corrosion-resistant technologies, systems, and services worldwide and remains the preferred choice by consistently providing its customers in the chemical and pharmaceutical industries with innovative and cost-effective solutions.

" GMM Pfaudler's ordering traction is healthy with PLI-led investments in India, while international operations improvement is on the cards from the ramp- up of its German and Chinese plants. With strong demand in chemicals, pharma and services, consolidated order book was a robust ~Rs 2,120 crore at end-Sep’22," analysts at Anand Rathi Share and Stock Brokers said in Q2FY23 result update.

The company expects better India business margins in H2, and 12-13 per cent international Ebitda margins despite fluctuating commodity prices and higher energy costs. Successful integration of its international business, cross-selling efforts, value-sourcing and the strong demand outlook keep us upbeat on GMM’s business momentum, the brokerage firm said.