Mandhana Industries Share Price Grows over 8% Intraday

Mandhana Industries share price saw a surge of more than 8 per cent intraday to touch a daily high of Rs 35.30. The intraday low of the share is Rs 31.60 so far.

At 1.45 PM Mandhana Industries share price was seen trading at Rs 34.60 apiece on NSE, up by 7.79 per cent or 2.50 points.

In today’s trading session 10,85,174 shares of the company have been traded on the counter of NSE for a total value of Rs 375.90 lacs.

Mandhana Industries is one of the multi divisional Textile Companies spread over multiple geographical locations. The company engages in the manufacturing of textiles as well as garments with its state-of-the-art infrastructure. The field of Mandhana’s business includes designing, yarn dyeing, weaving, processing, printing along with garment manufacturing. Planned infrastructural developments have helped it integrate vertically and establish itself as a niche player in the Indian Textile Industry with a turnover of over Rs. 6250 million (as on financial year 2009-10). From its humble beginnings 50 years ago as fabric retailers, the company has come a long way. All it had was goodwill, product and a receptive market to build an industry brick by brick.

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Mandhana tanks again as MRVL goes on Failing the Street

It was only few days ago that Mandhana Industries share price was soaring high on the IPO of its retail arm Mandhana Retail ventures. On the first day of its IPO after its demerger from Mandhana Industries, MRVL was locked in the upper circuit of 5 per cent on the BSE. On NSE, the stock was locked on the upper price band of Rs. 224. Two days later, the stock had traded on its new lifetime high of Rs. 247 taking the Mandhana Industries share price on an extended rally as well. It had gained over 10% in two trading sessions after listing on December 14 on the back of news that Rakesh Jhunjhunwala had bought 12.73% in the company. MRVL traded at its new lifetime low on two straight trading sessions on 20^th and 21^st December.

The Latest Scenario:

A little less than a week after its listing, the share price of MRVL was locked in the 5% lower circuit for the third successive day on little volumes. But the deal size, which is yet to be declared, has sparked rumors that Jhunjhunwala had bought the stake at a considerable discount in an 'off-market' deal to the listing price. At the peak price of Rs 246, MRVL was evaluated at about Rs 500 crore. Although such a disclosure is not authorized by market regulator SEBI, it however acts as confidence booster among shareholders. 

Also, the fact that stock exchanges had wanted a clarification from MRVL's parent company Mandhana Industries over the sudden spike in share price weighed on sentiment. As per the takeover regulations of SEBI, company promoters have to notify shareholders in two working days if there has been any material change of above 2% in the shareholding pattern of a company.

Even though MRVL was first traded on December 14, no change in promoter shareholding was put out by the stock exchange till December 16. However, it was revealed by the company that Jhunjhunwala had picked up stake in an off-market deal on the same day of listing, which led to the initial ecstasy. On the listing day, complete details of off-market trades were not revealed in MRVL, which has caused anxiety among investors.

Media reporting of Jhunjhunwala's stake purchase in MRVL created a positive prejudice, but problems at the parent company have not been highlighted. Mandhana Industries that recently went through the resignations in the board had to withdraw its dividend and is headed for debt restructuring. In the light of this, the price at which the stake was sold to Jhunjhunwala becomes vital.

MRVL said it had made sufficient disclosures and no questions have been raised by the regulator. MRVL said shareholding pattern has to be declared within 21 days from the end of each quarter. Promoters have revealed that they sold over 14% stake in MRVL, of which 12.7% was acquired by Jhunjhunwala.

Impact on Mandhana:

On December 19^th, Mandhana Industries share price opened at a discounted price of Rs. 41.15 as compared to its previous close of Rs. 45.70, slipping approximately 10 per cent. The stock traded at the same price all day. Yesterday, on 20^th December, Mandhana Industries share price further declined 10 per cent more and traded at Rs. 37.05. Today on 21^st December 2016 Mandhana yet again declined another 10 per cent and traded at the low of 33.35 while it had opened at Rs. 34.50.

However, Mandhana has strong fundamentals and hence it is recommended among the top 500 performing stock of the quarter. For the details on Mandhana Industries, visit Mandhana Industries share price history page of Dynamic Levels website.

Mandhana Industries extending its Wednesday’s Rally

Mandhana Industries is extending its Wednesday’s rally as market expert, Rakesh Jhunjhunwala is in talks to buy up to 15 per cent stake from its promoters in Mandhana Retail Ventures (MRVL), an arm of Mandhana Industries.

The equity shares of The Mandhana Retail Ventures were listed and admitted to dealings on the exchange in the list of 'T' group securities. The "T" group shows securities which are settled on a trade-to-trade basis as a surveillance measure.

After the demerger with Mandhana Industries, shares of Mandhana Retail Ventures hit the upper circuit on the first day of listing on bourses. Yesterday, the scrip increased 5 per cent to Rs 226.80 on the BSE while Mandhana Industries rallied 12.8 per cent to close at Rs 35.25.

In November 2014, Mandhana Industries announced that its board has given the approval for the demerger of the company's retail and trading business of the brand Being Human to Mandhana Retail Ventures Limited (MRVL).

Pursuant to the scheme of arrangement including the demerger of retail business  undertaking of Mandhana Industries (Demerged Company) into The Mandhana Retail Ventures Limited (Resulting Company), the newly formed Company would issue 2 fully paid up equity shares of Rs 10 each of the Resulting Company for every 3 fully paid up equity shares of the demerged company.

MRVL which houses Being Human brand which was incorporated by actor Salman Khan in the year 2007 is present across 700 point of sale outlets globally.The export business of MRVL is about 30 per cent and has 60 exclusive brand outlets globally.

The management aspires to grow by 20-25 per cent in the FY17 and achieve sales of Rs 500 crore. The proceeds from the stake sale will be utilised by the company to bring down debt and redeem pledged shares.

Meanwhile, Mandhana Industries share price has surged 12per cent to Rs 38.70 on the NSE in intra-day trade, extending its Wednesday’s 14 per cent rally on back of heavy volumes.

On the other hand, Mandhana Retail Ventures started off day at Rs 235.25 on the National Stock Exchange.

Within the next 15 minutes, around 20,44,416 equity shares changed hands on the counter with a traded value of Rs. 789.35 lacs, as per NSE.

Mandhana Industries Share Price touched the day’s high and low at Rs. 40.15 and Rs. 35.50, respectively. For two consecutive days, i.e on 14^th and 15^th the stock volume spurted by more than 4.86 and 2.13 times.

Mandhana Industries is one of the Top 500 performing stocks for this quarter as identified by Dynamic Levels, owing to its strong fundamentals.

Reforms Make Textile Sector Attractive For Investments

On Wednesday, 7^th Dec’ 2016 the Union Cabinet approved a set of reforms, including simplified labor laws and technology upgradation for the “Made-ups Sector”. The interventions are likely to boost employment in the textiles sector and create employment for up to 11 lakh persons, lead to increase in exports and augmented benefits to the workers in the textiles and apparel sector.

Made-ups include products like towels and bed sheets and are the second largest employer in the textiles sector after apparel. The Government will grant production incentive through enhanced Technology Upgradation Fund Scheme (TUFS), subsidy of further 10% for Made-ups similar to what is offered to garments based on additional production and employment after three years.

On labour laws front, the Government increased the allowable overtime up to 100 hours per quarter in Made-ups manufacturing sector in addition to making employees’ contribution to EPF optional for employees earning less than Rs 15,000 per month.

These incentives are element of the Rs 6,006-crore package announced for the Apparel Sector in June. The Textiles industry appreciates the Government’s initiative to support the Made-ups sector. This will facilitate India in creating huge employment, earning foreign exchange and creating footing for the fabrics and yarn sectors.

Binoy Job, Secretary General, Confederation of Indian Textile Industry (CITI) said that since the maximum sourcing for made-up sector is from the domestic industry, it will also help in Make in India plan.

The Government will provide additional 3.67% share of employer’s contribution in addition to 8.33% covered under Pradhan Mantri Rozgar Protsahan Yojana for all new employees enrolling in Employee’s Provided Fund Organization (EPFO) for the first three years of employment as a special incentive to Made-ups sector.

The International touch:

The approval came at a Union Cabinet meeting chaired by PM on the evening of December 7^th 2016. The Cabinet also gave its approval to the MoU between India and UK for cooperation in intellectual property (IP) and to support UK in ease of doing business in India. 

The MoU in ease of doing business will enable exchange of officials from both Governments to make the sharing of best practices easy, offering technical assistance and improved implementation of reforms. The collaboration will also cover state Governments in its domain.

Movement in the Sector:

Today, on 13^th December 2016, Mandhana Industries share price gained almost 20% and traded at the intraday high of Rs. 30.70. The stock price had dropped from Rs. 121 to Rs. 45 on 22^nd September after it demerged its retail business of the brand “Being Human” to Madhana Retail Ventures Limited.

Since the announcement, Himatsingka share price has gained over 4% on the NSE. Trident share price has gained over 2% since the announcement and Vardhman Textiles share price has risen over 2%.

Apart from the Mandhana Industries, which is a top 500 performing stock for the quarter, all the other stocks are multibagger stocks for the month recommended by Dynamic Levels.

The reforms in the sector and Make in India have made Textile stocks all the more attractive for investments.