Shares of Titagarh Rail Systems and Amber Enterprises rose on Thursday after the companies announced entering into a joint venture to expand into railway component and subsystem business in India and overseas.

Titagarh Rail’s shares hit an intraday high of Rs 1,127, 2.75% higher than its previous closing price on the National Stock Exchange (NSE), while Amber Enterprises surged as much as 10.47% to the daily high of Rs 4,217.95. 

At 2:40 pm, shares of Titagarh Rail were trading 1.60% higher at 1,114.25, and those of Amber Enterprises were trading 9.13% at Rs 4,166.60.

The companies announced in a joint press release that Titagarh Rail Systems and Amber Enterprises’ subsidiary, Sidwal Refrigeration Industries, have entered into an agreement to invest up to Rs 120 crore each to acquire equal control in a joint venture company/ Special Purpose Vehicle (SPV) for setting up the new railway component business as well as a fresh equity investment in Titagarh Firema SpA, Italy. 

The government of Italy’s investment arm, Invitalia, will also make a new investment into Titagarh Firema SpA, Italy, an associate of the Titagarh Group, for which an in-principle approval has already been obtained.

This venture will establish a new facility in India to manufacture critical railway components and subsystems used in manufacturing Railway & Metro coaches.

Further, the terms of the agreement stated that Firema would grant Sidwal, Titagarh Rail and the SPV a preferred supplier status and right of first refusal (ROFR) for all their products.