Greaves Cotton Shares Surge Close To 14%: Check Why

Greaves Cotton shares surge close to 14% intra-day and hit day's high price of Rs. 183.8 per share. The rally in the stock is post the company's electric arm inks investment with Abdul Latif Jameel.

"Greaves Electric Mobility Private Limited (formerly known as Ampere Vehicles Private Limited) ("GEMPL"), a wholly owned subsidiary of the Company, at its meeting held on May 31, 2022, the Company, GEMPL and Abdul Latif Jameel International DMCC ('Investor') have executed a share subscription agreement and a shareholders' agreement on June 02, 2022 (collectively, 'Agreements') for a proposed investment by the Investor in GEMPL of INR equivalent of USD 150,000,000 (USD One Hundred and Fifty million) for subscription by the Investor to 68,35,450 equity shares of GEMPL on a preferential allotment through private placement basis resulting in a shareholding of 35.80% on a fully diluted basis in GEMPL for the Investor in accordance with the terms and timelines set out in the Agreements", said the release.

Currently, GEMPL is a wholly owned subsidiary of the Company. Pursuant to the consummation of the Proposed Investment, the Company will have a shareholding of 61.38% on a fully diluted basis in GEMPL and post consummation of the Proposed Investment, GEMPL will continue to be a subsidiary of the Company. Additionally, it is clarified that post the consummation of last tranche of Optional Further Investments, GEMPL will continue to be a subsidiary of the Company. GEMPL, incorporated in 2008, is primarily engaged in the business of development, manufacturing and marketing of fully assembled electric two-wheeler and electric three-wheeler for personal mobility, industrial applications and materials movement.

Founded in 1945, and celebrating its 75th Anniversary in 2020, Abdul Latif Jameel is a private family-owned global investor and diversified business with interests that include investments, transportation and mobility, financial services, land and real estate, energy, and environmental services, health, consumer products, and advertising and media.

Greaves cotton is a small cap diesel engines firm.