SJS Enterprises aims to compound its revenue on the back of acquisitions. Based in Bengaluru, it is among companies that operate in the decorative aesthetics industry.
Shares of SJS Enterprises, an aesthetics component company, shot up 2 percent on August 23, extending the previous day’s 4 percent gain, after Evergraph Holdings, a promoter group entity, sold a 29.5 percent stake in the company.
“The block was doing the rounds for some time now and they finally found buyers,” a dealer told Moneycontrol. “This removes a key overhang from the stock as the private equity fund would have exited some day or the other.”
ICICI Prudential Mutual Fund, Aditya Birla Sun Life MF and Sundaram MF were among those that picked up the stake held by Evergraph, a subsidiary of PE firm Everstone Capital.
The indicated floor price of the block deal was Rs 580 per share, marking a 6.5 times return on Evergraph’s average cost of acquisition of Rs 88.15. The shares closed at Rs 641.30 on the BSE on August 22.
SJS Enterprises had noted in its initial public offering prospectus of 2021 that Evergraph lacked significant experience in the decorative aesthetics industry.
“Evergraph entered into an arrangement with Sanders Consulting, a company jointly owned by our Executive Director and CEO, Sanjay Thapar, pursuant to which Evergraph agreed to make certain payments to Sanders Consulting in exchange for non-binding strategic and operational advice,” the company said in the red herring prospectus dated October 22, 2021.
The PE fund’s exit was evident, more so after the stock rallied over 60 percent from a low on March 20. To cash in on the gains, ace investor Ashish Kacholia too pared some of his stake in the company on August 18. Kacholia offloaded 180,000 of the 1.38 million shares held at the end of June.