Services
Equity Trading with CA Abhay
FNO Stocks with CA Abhay
Option Trading with CA Abhay
Equity Investment with CA Abhay
Stock Market Masterclass
A.K. Spintex Acquires Sunrakshak Agro Products for Business Diversification
Team Finance Saathi
27/Dec/2024
What's covered under the Article:
- A.K. Spintex Limited acquires 100% equity of Sunrakshak Agro Products Private Limited.
- Acquisition aligns with diversification strategy into FMCG and intermediate chemical products.
- SAPPL specializes in soaps, detergents, toothpaste, and personal care products with strong market presence.
A.K. Spintex Limited Completes Acquisition of Sunrakshak Agro Products Private Limited (SAPPL)
On December 27, 2024, A.K. Spintex Limited announced that it has successfully acquired 100% equity in Sunrakshak Agro Products Private Limited (SAPPL), marking a significant step towards business diversification and the expansion of its presence in the FMCG sector. This move aligns with A.K. Spintex's long-term strategy of tapping into new business avenues and exploring growth opportunities in the manufacturing of FMCG products and related chemicals.
Acquisition Details
Sunrakshak Agro Products Private Limited (SAPPL), a company incorporated under the Companies Act, 2013 in February 2020, specializes in the production of a wide range of FMCG products and their intermediate chemicals. The company’s manufacturing capabilities include soap noodles, soap, toothpaste, detergent powder, detergent bars, home care, and personal care products. SAPPL operates primarily in Bhilwara (Rajasthan) and Roorkee (Uttarakhand) and has established itself as a key player in the FMCG sector with state-of-the-art infrastructure.
SAPPL’s turnover has shown exponential growth, reaching Rs. 311.43 Crores in FY 2023-24, which highlights the company’s robust financial performance. This growth trajectory has made SAPPL an attractive acquisition target for A.K. Spintex.
Strategic Rationale for the Acquisition
The acquisition of SAPPL is driven by the opportunity to enter the FMCG industry, which is poised for continued expansion. A.K. Spintex intends to leverage SAPPL’s established manufacturing infrastructure and product portfolio to further diversify its offerings. The deal will strengthen A.K. Spintex's position in the FMCG sector, complementing its existing operations in the textile industry, thus opening new business lines in the growing consumer products market.
Financial Overview of SAPPL
SAPPL’s financial performance has been impressive, with significant growth year-on-year:
- FY 2021-22: Rs. 7.17 Crores
- FY 2022-23: Rs. 137.74 Crores
- FY 2023-24: Rs. 311.43 Crores
This growth trajectory underscores SAPPL’s strong market position, making it an ideal acquisition target for A.K. Spintex.
Nature of the Acquisition
The acquisition is classified as a related party transaction, with key stakeholders in A.K. Spintex holding significant interests in the transaction. The deal is in line with the company’s broader growth strategy and was conducted on arm’s length terms. As part of the acquisition, A.K. Spintex will purchase 100% of the issued and paid-up equity shares of SAPPL, ensuring full ownership and control over the company.
Regulatory Approvals and Process
In accordance with SEBI’s Listing Obligations and Disclosure Requirements, the transaction has been disclosed in compliance with Regulation 30 and relevant SEBI circulars. The acquisition is expected to be completed within one to two weeks, subject to the necessary formalities being finalized.
Impact and Future Outlook
This acquisition marks a new chapter for A.K. Spintex as it ventures into the FMCG space, capitalizing on SAPPL’s robust manufacturing capabilities and product portfolio. The company’s focus on soap production, detergent products, and personal care items aligns well with current market trends and consumer demand for high-quality FMCG goods.
A.K. Spintex aims to continue its expansion and strengthen its foothold in the FMCG market, ensuring the integration of SAPPL’s operations into the company’s larger business framework.
The Upcoming IPOs in this week and coming weeks are Indo Farm, Technichem Organics, Leo Dry Fruits, Solar91 Cleantech, Rosmerta Digital and Avanse Financial.