Major acquisition of shares in Indian dairy sector

An agriculture-based company has made a significant move by acquiring a 48.06 per cent stake in Creamline Dairy Products Limited (CDPL) for Rs 930 crore. This development marks CDPL becoming a wholly-owned subsidiary of the company. This strategic integration aims to enhance the company's foothold in the dairy sector, further tapping into the milking potential of southern India. This purchase is a part of a related party transaction, managed at arm's length with CDPL's promoter group.

Godrej Agrovet, driving this acquisition, is poised to dominate the market scene. With a robust market capitalization of Rs. 14,336.93 crore, Godrej Agrovet's financial health seems promising. Over the past year, its stock delivered a return of 44.63%, improving from previous fiscal metrics.

The company has also appointed Mr. Y. V. Sathish to lead its Manufacturing & Supply Chain Excellence, leveraging his vast experience at major FMCG giants. Meanwhile, financial insights reveal Godrej Agrovet achieved a revenue rise of 1.99% in FY24 and witnessed a substantial boost in net profit to Rs 416.07 crore.

Investors might find interests piqued by the company's impressive returns and steady shareholder strategy. As a mid-cap stock, it stands out with a 36x PE ratio, above the industry average.