Ashoka Buildcon Shares Surge 7% Following Major Acquisition

On October 31, 2024, shares of Ashoka Buildcon soared by nearly 6.7%, reaching a price of ₹248.45 on the Bombay Stock Exchange (BSE). This spike in share price came in response to the company’s announcement that it had acquired an additional 34% stake in Ashoka Concessions Limited (ACL) for ₹1,526 crore. This move is significant as it will transform ACL into a wholly-owned subsidiary of Ashoka Buildcon.

The acquisition aims to facilitate an exit for investors, including Macquarie SBI Infrastructure Investments and SBI Macquarie Infrastructure Trust. With this purchase, Ashoka Buildcon will consolidate its ownership of ACL, which specialises in highway infrastructure. The company already owned 66% of ACL, and this deal will enhance its position in the road infrastructure sector.

ACL is known for managing build-operate-transfer (BOT) road and annuity highway projects. By consolidating its investments in ACL, Ashoka Buildcon will streamline its operations and focus more on its infrastructure initiatives. This strategic decision will enhance the company’s overall performance and create shareholder value.

Ashoka Buildcon’s Share Price Performance 

As of 10:16 AM on October 31, Ashoka Buildcon’s share price continued its upward momentum, trading at ₹239.85, reflecting a gain of 3.01% for the day. This is impressive, considering the BSE Sensex was down by 0.31% during the same period. 

Over the past year, Ashoka Buildcon’s stock has outperformed the broader market, rising by 84.1%, while the BSE Sensex has only seen a 24.7% increase. The company boasts a market capitalisation of ₹6,721.92 crore and a price-to-earnings ratio of 13.99, with earnings per share of ₹16.64.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.