HFCL acquires stake in Raddef
Himachal Futuristic Communications Ltd. (HFCL) has acquired 90 per cent of the equity shares of Raddef Pvt. Ltd.
The purpose of the acquisition is to reap the benefits of operational synergies. Moreover, it will present HFCL with the opportunity to explore untapped growth in the telecom and defence business verticals of the company.
The acquisition involved payment of cash consideration of Rs 90,000 towards 9,000 fully paid-up equity shares acquired from the existing shareholders of Raddef.
The acquisition does not amount to a related party transaction. The promoters and promoter group do not have any interest in the entity being acquired. As such, the transaction is conducted at arms-length. No government approval is required for the acquisition.
Raddef Pvt. Ltd. operates in the telecom and defence industry. It is engaged in the designing and development of a wide range of sub-systems for radio frequency (RF) & microwave products to customers in India and across the globe. These customers are employed in the fields of navy, military, aerospace, process control and automation, communication, test and measurement industry. It reported a total turnover of Rs 9,63,500 in FY17-18. Its equity paid-up capital stands at Rs. 1,00,000.
Moving forward, with the intention of supporting R&D initiatives and to develop new products, HFCL will make further investments in Raddef for an amount of Rs 20 crore by way of equity contribution in the near future.
On the standalone financial front, HFCL reported total income from operations of Rs 1,094.68 crore in Q4FY19 as against Rs. 944.15 crore in Q4FY18, posting a YoY growth of 15.94 per cent. EBITDA dropped to Rs. 65.11 crore in Q4FY19 from Rs. 75.15 crore in Q4FY18, marking a decrease of 13.36 per cent YoY. PAT fell to Rs. 51.49 crore in Q4FY19 in comparison to Rs. 58.75 crore in Q4FY18, thereby sinking 12.36 per cent YoY. Consequently, EPS spiralled down to Rs. 0.42 in Q4FY19 from Rs. 0.47 in Q4FY18, registering a fall of 10.64 per cent.
Furthermore, the board has recommended a dividend of Rs 0.10 per share for the financial year ended March 2019, subject to the approval of the shareholders. The same shall be paid within 30 days from the date of declaration.
On Thursday, the shares of HFCL opened at Rs. 21.30, and hit a high and low of Rs. 21.30 and Rs. 19.70, respectively. At 10:41 am, the stock was trading at Rs 20.20, down by 4.27 per cent.