On January 23, 2025, Sellwin Traders Ltd’s share price surged by 4% following the announcement of a significant strategic move. The Kolkata-based company has entered into a Memorandum of Understanding (MOU) with Mumbai-based Subhshri Overseas Ltd, a prominent ₹250 crore group, aiming to establish a holding-subsidiary relationship.
Details of the MoU
The collaboration involves a share swap arrangement, wherein Sellwin Traders will become the holding company, and Subhshri Overseas Ltd will operate as its subsidiary. A third-party valuation expert will determine the share swap ratio based on business prospects. This non-binding agreement also ensures confidentiality and good-faith negotiations.
Key highlights of the arrangement:
- Ownership Structure: Sellwin Traders will acquire a percentage of shares in Subhshri Overseas Ltd, meeting the requirements of the Companies Act.
- Board Representation:
- The holding company will appoint at least one director to the subsidiary’s board.
- The subsidiary company will nominate two directors to the holding company’s board, one regular and one independent.
- Operational Independence: Subhshri Overseas Ltd will retain operational control, maintaining autonomy in daily activities.
About Subhshri Overseas Ltd
Subhshri Overseas Ltd, founded in 1971 and part of the M S Group, specialises in exporting products like readymade garments, textiles, and food items to markets in the Middle East, Africa, and Europe. The group, with an annual turnover of ₹250 crore, has earned accolades, including a government award for excellence in exports.
Financial Highlights of Sellwin Traders
Sellwin Traders Ltd has demonstrated robust financial performance in FY25:
- Nine-Month Revenue: ₹49.67 crore, a 103% increase compared to ₹24.43 crore in the same period last year.
- Nine-Month Net Profit: ₹2.26 crore, up from ₹57 lakh last year.
- Q3FY25 Revenue: ₹17.41 crore, reflecting 90% growth.
- Q3FY25 Net Profit: ₹75.75 lakh, a staggering 257% increase.
Strategic Implications
The MOU positions Sellwin Traders to benefit from Subhshri Overseas Ltd’s expertise in international markets, particularly its stronghold in the textile and apparel export sector. This strategic alliance could potentially open new avenues for revenue and operational synergies.
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