JK Cement’s share price gained 2% in the early morning trade as the company plans to acquire 100% entire shareholding in Toshali Cements Private Limited.

On June 5, JK Cements’ board of directors accorded in-principle consent to sign and implement a share purchase agreement with the company’s shareholders and also with Toshali Cements for the purchase of 100% equity shareholding from all the prevailing shareholders of Toshali.

The overall cost of the acquisition is Rs 157 crore, and after the acquisition, Toshali will be the subsidiary of JK Cement.

The acquisition will fulfil the company’s expansion with its footprint towards the eastern region. The company’s board of directors empowered the committee of directors to initiate the procedures once the conditions were achieved.

The company posted a decline of 45% to Rs 110 crore in joined net profit for the quarter ended March 2023 versus Rs 199.44 crore in the 2022 period.

In a recent report, brokerage firm Jefferies India downgraded JK Cement to ‘hold’ from ‘buy’ due to expensive valuations posts the recent increase in the stock price. It raised its target price by 5% to Rs 3,260 per share from Rs 3,200 earlier.

At 9:20 am, JK Cement traded Rs 3,287.40, up Rs 82.75, or 2.58% on the BSE.

The share moved a 52-week high of Rs 3,288.90 and a 52-week low of Rs 2,005 on May 30 2023, and June 23 2022, respectively.

Currently, it is quoting 0.05% below its 52-week high and 63.96% above its 52-week low.