Shares of Elgi Equipments increased on March 13 after the company announced that its wholly-owned arm Elgi Compressors USA Inc, entered into an operating agreement to acquire a 33.33% stake in CS Industrial Services LLC, a North Carolina limited liability company.

Elgi Euipments shares were trading at Rs 489 on the NSE, up 4.26% at 10:02 am, after touching an intraday high of Rs 494.

A total of 300,000 shares of the company’s stock changed hands on the exchange, compared with a daily average of 100,000 shares for a week.

CS Industrial Services has not yet commenced business operations. Therefore, the subsidiary will acquire the company’s Class A shares for $100,000 and Class B shares for $25,000.

Class A shares typically have more voting power than Class B shares. Under the agreement, the acquisition will make CS Industrial Services the exclusive dealer and distributor of Elgi brand compressors in Western New York.

Brokerage ICICDirect also expects the company’s expansion into new international markets to drive its long-term incremental growth, as the rest of the world contributed nearly 50% of its revenue in FY22.

The brokerage also upgraded the stock to “buy” in February with a price target of Rs 500, citing its long-term positive outlook.