NTC Ind. jumps 3% after signing swap agreement to acquire 51% stake in Solitude Flame

Shares of the micro-cap stock jumped over 3 percent after the company announced plans to issue equity shares on a preferential basis at Rs.234 per share. Additionally, it has entered into a Share Swap Agreement to acquire a 51 percent stake in Solitude Flame Private Limited (SOL).

Price Variation

On Monday, shares of NTC Industries Ltd reached to an intra-day high of Rs.190.00 apiece, rising 3.3 percent from its previous close of Rs.183.90 each. However, the stock later pared some gains and was trading at Rs.185.00 per share. Over the past five years, the stock delivered over 560.71 percent returns. 

Swap Agreement 

The company has approved the issuance of up to 32,57,892 equity shares with a face value of Rs.10 each on a preferential basis, subject to shareholder approval and necessary regulatory clearances. These shares will be issued at a price of Rs.234 each to the specified shareholders of Solitude Flame Private Limited (SOL), in compliance with SEBI’s regulations.

The company has entered into a Share Swap Agreement with SOL and its specified shareholders on 15th February 2025. As part of this agreement, NTC Industries Ltd will exchange 32,57,892 of its equity shares for 51,000 shares of SOL, representing 51 percent of SOL’s total share capital. The swap will occur at the same preferential issue price of Rs.234 per share.

Also read: FMCG stock under ₹50 jumps 15% after reporting 80% YoY net profit growth in Q3

Other Developments

The company has entered into a Share Subscription Agreement with Dunkelbraun Private Limited for an investment of Rs. 20 Crores in Equity/Optionally Convertible Preference Shares (OCPS), resulting in a 7.96 percent stake in Dunkelbraun’s diluted paid-up share capital. The funds will be used for capital expenditure and expanding Experience Centres, Boutique Centres, Kiosks, Kitchens, HORECA, and online sales across India. 

Additionally, Dunkelbraun will market and promote NTC Industries’ products, sharing 4.50 percent of its revenue from all stores as a monthly commission to NTC, continuing as long as NTC holds any share in Dunkelbraun. This is a financial and strategic move, with no impact on NTC’s management or control.

Earnings Report

Turning towards the financials of the company, NTC Industries Ltd reported Q3 FY25 revenue of Rs.13.43 crore, rising 82 percent remarkably from Rs.7.35 crore in the same quarter last year. Additionally, Profit After Tax (PAT) increased by 86 percent to Rs.2.34 crore, from Rs.1.26 crore in the same period. 

Business Overview

NTC Industries Ltd, formerly known as National Tobacco Company, was established in September 1931 in Kolkata, West Bengal. It is one of India’s oldest cigarette manufacturers and holds a license to produce cigarettes and tobacco products. The company processes tobacco blends and manufactures packed cigarettes and smoking mixtures.

NTC Industries has a solid presence in both the Indian and international markets. It has earned recognition for its high-quality products at international events in cities like Brussels, Rotterdam, Amsterdam, Paris, and Luxembourg.

Written by – Siddesh S Raskar

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