In what is seen by many in the Indian automotive industry as a hostile takeover attempt, Minda Corporation, the flagship arm of the Spark Minda Group, on Friday announced making a 15.7 percent acquisition in rival company Pricol Ltd from the open market at an aggregate value of Rs 400 crore.
Noida-headquartered Minda Corp in an exchange filing said, “This is merely a financial investment without providing the company any special rights in Pricol Limited other than the rights as a shareholder of Pricol Limited.”
The development and the resulting stock volatility prompted Vikram Mohan, Pricol's managing director and representative of the promoter Group, to reiterate that the promoters have absolutely no intent of undertaking any secondary sale nor does the company have any intent to raise equity capital in any form as the company has strong financial fundamentals and healthy cash profits that will meet the needs of capital for its future growth.
“The promoters and the management stand committed to its stakeholders and are bullish about the growth prospects of the organisation combined with a firm financial footing,” Mohan said in a statement.
Pricol, founded in 2011, had a consolidated turnover of Rs 1,553.5 crore, Rs 1,420.9 crore, and Rs 1,254.3 crore in FY2022, FY2021 and FY2020 respectively.
In Q3 FY2023, Minda Corp reported almost 84 percent of its revenue from domestic business and 16 percent from exports. Due to geopolitical challenges and global headwinds, quarterly shipments were hampered. The company carries out its business and operations in driver information systems and sensors, pumps and allied products, telematics and wiping systems catering to automotive OEMs in two and three-wheeler, passenger vehicles, commercial vehicles, farm equipment and offroad vehicles across India and in international markets with 2,000 plus product variants.
Minda Corporation, which has a significant national and international footprint, is the flagship company of Spark Minda, which was part of the erstwhile Minda Group. The company has 33 manufacturing plants and 16,000 plus employees worldwide. The company has a diversified product portfolio that encompasses mechatronics, information and connected systems, interior plastic and electronics for auto OEMs. It generated consolidated revenues to the tune of Rs 3,000.1 crore during FY2022, Rs 2,401.1 crore during FY2021 and Rs 2,857.4 crore during FY2020.