FII-Owned Textile Stock Jumps 8.4% After Acquisition Deal of Rs 3.49 Cr

Vishal Fabrics Ltd shares rallied 8.4% on Tuesday to reach Rs 30.49 per share compared to the previous closing of Rs 28.12/share. The bullish trend is after Vishal Fabrics announced and completed an increase in ownership in Chiripal Textile Mills Pvt Ltd (CTMPL). On 24th March 2025, Vishal Fabrics purchased 1,73,825 equity shares of CTMPL at a price of share of Rs 201 as per the valuation report at a total consideration of Rs 3,49,38,825. The strategic acquisition increases Vishal Fabrics stake in CTMPL from 37.72% to 42.36% which strengthens the position of CTMPL as an associate company.

CTMPL, which engages in the manufacturing and processing of textiles, has reported a revenue turnover of Rs 530.55 crore for the financial year ending March 31, 2024. The transaction is considered a related party acquisition due to CTMPL already being an associate company with promoter group interest. The deal was done with the intention of strengthening business synergies and facilitating future growth on an arm's-length basis. A paid - up capital of Rs 37.45 lakh is accompanied by an authorized share capital of Rs 9.72 crore for CTMPL.

Vishal Fabrics' strong results have been noted over the quarterly and nine months period. In the nine month period of 9MFY25, net sales amounted to Rs 1,128.4 crore while net profit reached Rs 21.7 crore. For the Q3FY25 performance, net sales increased to Rs 403.7 crore which shows a 5% increase compared to Q2FY25 along with a net profit increase of 32% compared to Q2FY25, reaching Rs 9.6 crore. The fiscal year 2024 annual performance also reflects net sales reaching Rs 1,450 crore while net profit remains at Rs 21 crore.

With the most recent update, the company's promoters retain a dominating 69% stake, 3.44% is owned by Foreign Institutional Investors (FIIs) and public shareholders possess 27.56%. The current market capitalization of Vishal Fabrics surpasses Rs 500 crore.

Established in 1985, Vishal Fabrics Ltd is a member of the Chiripal Group located in Gujarat and deals in production and sale of dyed yarn, denim, and made-to-order textile products. The company is also certified for quality and sustainability for dyeing, printing, as well as processing denim and other fabrics. Its fabrics include 100% cotton, cotton-and-modal blends, as well as stretch denim where the company is a market leader. Vishal Fabrics has several plants located in Ahmedabad, Gujarat and sells to numerous international garment retailers.

The enhanced CTMPL stake along with Vishal Fabrics' robust financial results indicate the company's efforts to boost productivity and deepen market penetration within the textile industry.