Forbes Precision Tools and Machine Parts made a decent stock market debut on June 11 as it got listed over 11 percent higher on the BSE at Rs 209.
Post listing, the stock extended its gains and was caught in its upper circuit at Rs 219.45 on the BSE.
The demerger of Forbes & Co's precision tools business was announced back in September 2022, and the NCLT's approval for the same came in March earlier this year. Following the demerger, Forbes Precision Tools and Machine Parts was carved out to focus on the precision tools business, which includes manufacturing and trading of cutting tools, HSS taps, drills, threading tools, and other precision tools.
The precision tools business had a turnover of Rs 179.22 crore in FY22, making up 76.25 percent of Forbes & Co's total turnover for the same fiscal.
Given that the precision tools business accounted for a major chunk of Forbes & Co's revenue, the listing of the hived off entity happened at a market capitalisation of over Rs 1,100 crore.
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The already listed legacy business, Forbes and Co, which operates in real estate and laser printing, commands a lower market cap of around Rs 800 crore.
The demerger is poised to unlock shareholder value by listing the precision tools business separately, facilitating focused investment in distinct business segments and enabling improved capital allocations.
In addition, the Shapoorji Pallonji group company also rationalised the move by stating that it would provide greater independence to the hived entity to pursue tailored growth strategies.
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