Gokaldas Exports Surges 10%, Acquires Atraco Group for $55M in Strategic Move

30 Aug 2023 , 01:43 PM

Gokaldas Exports shares surge by 10% on August 30 following the announcement of acquiring Atraco Group based in Dubai. The previous trading day saw a 20% increase, with shares reaching a 52-week high of Rs 736.30 per share on BSE.

Atraco Group operates through manufacturing units in Kenya and Ethiopia, producing about 40 million garments annually. In 2022, Atraco Group achieved around $107 million in revenue and $7.2 million post-tax profit.

The acquisition is valued at $55 million (approximately Rs 455 crore) and will be financed through debt and internal accruals. The deal covers shares and assets and is subject to regulatory approvals, expected to be completed in Q3 FY24 (October-December 2023).

The acquisition is at an attractive valuation of eight times the price-to-earnings (P/E) ratio. Gokaldas Exports gains access to cost-effective, duty-free manufacturing locations through this acquisition.

Gokaldas Exports sees the acquisition as strategically significant, citing a complementary customer base and operational strength. The company is a key Indian manufacturer and exporter of ready-made garments for all seasons.

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