Sula Vineyards jumps 2% after HDFC MF, Morgan Stanley, others acquire 7.06% stake

Shares of Sula Vineyards jumped nearly 2 percent in early trade on September 1, after a large block deal involving the acquisition of 7.06 percent stake in the company by HDFC Mutual Fund, Morgan Stanley and other prominent market players.

At 9:42 am the Sula Vineyards stock was trading 1.87 percent higher at Rs 497.02 on NSE.

Details of the block deal

In a significant development within the beverage industry, prominent financial market players such as HDFC Mutual Fund, Morgan Stanley Asia Singapore Pte, Societe Generale, and Ghisallo Master Fund LP have collectively procured a noteworthy 7.06 percent stake in Sula Vineyards, the largest wine producer in India. The acquisition was facilitated through open market transactions on August 31.

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The acquisition of 59.58 lakh equity shares at an average price of Rs 484 per share amounts to Rs 288.4 crore in total. Simultaneously, foreign investor Verlinvest Asia Pte Ltd has executed a strategic divestment by selling 1.06 crore shares or a substantial 12.56 percent stake in Sula Vineyards. The shares were sold at an average price of Rs 484.13 per share, thereby yielding Rs 513.18 crore.

Also Read: Sula Vineyards down 5% after 13.1% stake changes hands

After the stake sale, Verlinvest Asia Pte, which had an 18.64 percent shareholding in the company, will be left with a 5.54 percent equity. The remaining stake will also be locked for 60 days. Earlier this month, Sula Vineyards recorded its highest three-day sales, individual tastings, and visitors from August 12–14 at its wine-tourism facilities in Nashik and Bengaluru.

During the first quarter of FY24, Sula also reported a 24.4 percent jump in net profit, attributed to robust demand for its premium wines and higher visitor numbers at its vineyards. The Mumbai-based company recorded a consolidated net profit of Rs 13.68 crore for the June quarter, up from Rs 11 crore in the corresponding period the previous year.

Shareholding Pattern of Sula Vineyards

Sula Vineyards has a market capitalization of Rs 4,131 crores. A majority of the ownership, about 55.72 percent, belongs to the general public, while the promoters have 27.27 percent ownership. Other financial institutions i.e., DIIs own 10.23 percent, and FIIs own 6.78 percent of the company.

Stock Performance

Sula Vineyards stock has given a return of 37.59 percent over the last six months. The benchmark Nifty50 index has given a return of 10.33 percent over the same duration.

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