PG Electroplast Limited witnessed a significant surge in its share price on November 19, 2024, reaching a 52-week high of ₹718.35 during early trade. This rally comes after the company’s wholly-owned subsidiary, PG Technoplast, signed a definitive agreement with Spiro Mobility to manufacture electric vehicles (EVs) and lithium-ion batteries in India.

EV Manufacturing Agreement Details

Under the terms of the agreement:

• PG Technoplast will be responsible for establishing and managing manufacturing facilities for EVs, lithium-ion batteries, and associated components.
• It will also handle the procurement of parts and raw materials specified by Spiro Mobility.
• Spiro Mobility will focus on research and development (R&D), marketing, sales, and distribution of the EV products manufactured by PG Technoplast.

This collaboration marks PG Electroplast’s entry into the burgeoning EV and battery manufacturing industry, positioning it for substantial growth in the Indian EV market.

Market Reaction

At 9:31 AM, PG Electroplast shares were trading at ₹683.80, up ₹59.15 (9.47%) on the Bombay Stock Exchange (BSE), driven by investor optimism around the company’s diversification into the EV sector.

Company Statements

Commenting on the development, Vishal Gupta, Managing Director (Finance), PG Electroplast, expressed confidence in the partnership:

“The company’s entry into EV and lithium-ion battery manufacturing opens up a new horizon of growth. With a partner like Spiro, this association is expected to create a significant presence in the EV market in India.”

Recent Developments

In October 2024, PG Electroplast’s board approved the issuance of equity shares or convertible securities worth ₹1,500 crore through Qualified Institutions Placement (QIP). This move is likely to provide the necessary financial backing for its ambitious ventures, including the EV manufacturing initiative.

Financial Performance

For the quarter ended September 2024 (Q2 FY25):

• The company reported a net profit of ₹19.56 crore, marginally lower than the ₹19.69 crore posted in the same period the previous year.
• Despite the slight decline, the new partnership signals an avenue for sustained growth and revenue diversification.

Growth Prospects in the EV Market

The EV industry in India is poised for rapid expansion, with increasing government support and demand for sustainable mobility solutions. PG Electroplast’s entry into this sector aligns with market trends and positions the company as a key player in EV manufacturing.

Investor Sentiment

The announcement has been well-received, with analysts noting the strategic importance of this partnership. The stock’s 52-week high reflects confidence in the company’s ability to capitalize on the EV sector's growth potential.

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