Penny stock under Rs 2: Company approved the execution of a term sheet to acquire 25% equity shares of Semitrone Conchem Ltd
The stock is up by 77.5 per cent from its 52-week low of Re 0.71 per share.
Sylph Technologies Ltd has announced its plan to acquire a 25 per cent stake in Semitrone Conchem Ltd., a company that manufactures construction chemicals. This acquisition is intended to help Sylph Technologies expand its own business. The deal, which involves a cash payment of approximately Rs 13.33 crore (about USD 1.6 million) at Rs 40 crore valuation via preferential allotment, is expected to be finalised within 180 days.
Interestingly, this acquisition is considered a related party transaction because one of Sylph Technologies' directors, Mr. Hasmukh Shah, already owns a significant number of shares in Semitrone Conchem Ltd. However, the companies have stated that the transaction is being conducted at an "arm's length," meaning it's on fair market terms despite the existing connection.
The agreement also includes provisions to protect Sylph Technologies' investment. For example, if Semitrone Conchem Ltd. doesn't meet its financial projections for the next three years, or if there's a breach of agreement, Sylph Technologies has the option to sell back its shares to the existing shareholders for the original investment amount plus a 12 per cent cumulative annual return. This ensures a safeguard for Sylph Technologies' investment in the new venture.
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About the Company
Sylph Technologies Ltd, established in 1992, offers a diverse range of services beyond its core software development, encompassing newspaper distribution, financial instrument trading, solar power plant trading, IT services, newspaper printing, business process outsourcing, and knowledge process outsourcing. The company has a market cap of Rs 41.61 crore and its 100 per stake is owned by the public shareholder.
Results: According to the Quarterly Results, the company reported net sales of Rs 0.18 crore and net profit of Rs 0.12 crore in Q4FY25. In its annual results, the net sales decreased by 88 per cent to Rs 1.96 crore in FY25 compared to Rs 15.75 crore in FY24. The company reported a net loss of Rs 0.93 crore in FY25 compared to a net loss of Rs 2.51 crore in FY24.
The company has a market cap of over Rs 100 crore with 100 per cent stake owned by public shareholders. The stock is up by 77.5 per cent from its 52-week low of Re 0.71 per share.
Disclaimer: The article is for informational purposes only and not investment advice.