Pipavav Defence in the limelight

Pipavav Defence is in the limelight today with the stock rising almost 7.5% at Rs.54 levels with an intra day high at Rs.56. Volumes are also pretty good. Its 52-week high stands at Rs.73.90.

The stock is up on unconfirmed news that M&M, the Hero group and a French shipbuilder DCNS, are vying for a 19% sake buy in Pipavav. The company which has facilities to make warships, submarines and LNG carriers has not yet issued a denial or clarification on this news yet. The grapevine has it that the Chairman, Nikhil Gandhi and his younger sibling and MD, Bhavesh Gandhi having a 45% stake could be the sellers of their 19% stake. At todays market rate, this could fetch them about Rs.700 crore.

The promoters have sold minority stake earlier – 3.5% stake to Singapore's Sembcorp Marine, an expert in ship repair and another 3.5% stake to Sweden's Saab AB; all this stake sale was at a time when Pipavav had not yet got into defence.