The Hindu Business Line : Mather & Platt jumps thanks to its holding in Shaw Wallace

THE stock of Mather & Platt India (MPIL), a Jumbo group company, has gained almost four times in the last one month due to its holding in Shaw Wallace & Company. .

Brokers attribute the spurt in the stock price to its holding of 4.86 per cent (23.30 lakh shares) stake in Shaw Wallace & Company (SWC).

Last month, Business Line reported that Jumbo group had appointed McKinsey to seek bids from interested parties to take a major stake in SWC's liquor business.

The stock has gained from Rs 23.7 on November 1 to today's closing price of Rs 98.20 on the BSE, a rise of 314 per cent.

At the current market price of Rs 153 for SWC stock price, the total value of Mather & Platt holding works out to be Rs 35.65 crore. Brokers said once the SWC stake is sold, the proceeds from the sale would be distributed amongst the shareholders of MPIL. Based on the equity capital of Rs 57 lakh, comprising 5.7 lakh shares, the value of this stake works out to Rs 625 per share.

In addition, MPIL holds 19.54 lakh shares of Mather & Platt Fire Systems constituting 57.45 per cent of its equity. The value of shares of Mather & Platt Fire at its current price of Rs 6.57 translates into a market value of Rs 1.28 crore. The value of these investments works out to Rs 22.45 per share of MPIL.

Brokers tracking the Jumbo group's listed companies said there is a high probability of unlocking of MPIL holdings in SWC.

Stock price of SWC has also gained more than 50 per cent in the last one month.

However, some brokers said sharp rise in the stock price of MPIL is due to low floating stock in the market. "Since the floating stock of MPIL in the market is very low, it is easy to push up the stock price," said a dealer with a domestic broking firm.