Orient Refractories hits a new high

about 5 months ago
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Orient Refractories is shining bright today morning, hitting a new 52-week high today at Rs.236.20, going up 13%.

Two reasons for this new found love – one, the Q1FY19 numbers were very encouraging and second, the merger of its two unlisted subsidiaries with itself.

The earnings –  net profit for the period rose over 37% (YoY) to Rs.22 crore on a 16% jump in revenue at Rs.174 crore.

The merger – yesterday, the decision was taken to merge RHI India Private Limited (RHI India) and RHI Clasil Private Limited (RHI Clasil) with Orient Refractories, making it a leading manufacturer and supplier of refractories with operating revenues of Rs.1,235 crore, two production facilities, and more than 700 employees.

Following completion of the merger and subject to receipt of necessary approvals, Orient Refractories will be renamed to RHI Magnesita India Limited.

As consideration for the merger, fresh equity shares of Orient Refractories will be issued to the shareholders of RHI India and RHI Clasil, thus increasing the equity shares of Orient Refractories from 120.1 million to about 161 million. About 7,044 equity shares of Orient Refractories (of face value of Re.1 each) will be issued for every 100 equity shares of RHI India (of face value of Rs.10 each).

Similarly, 908 equity shares of Orient Refractories (of face value of Re.1 each) will be issued for every 1,000 equity shares of RHI Clasil (of face value of ?10 each). Post merger, the shareholding of RHI Magnesita, through Dutch US Holding B.V. and other group companies, in the combined company is likely to be around 70%. Furthermore, around 5% of the shareholding will be held by certain individual shareholders of RHI Clasil who are not part of the RHI Magnesita group.

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