Nalanda Capital has increased its holding in power transformer maker Voltamp Transformers by picking up another 2 per cent stake from the markets on Wednesday. The Singapore-based firm, which invests in listed Indian companies, has picked up the stake for Rs 10.3 crore, increasing its holding to 12 per cent.
Nalanda picked up the stake in Voltamp from Reliance Diversified Power Sector Fund in two block deals on the BSE and the NSE at Rs 489.98 per share. The share price of Voltamp was trading at Rs 487.05, marginally down 0.98 per cent. The share price is currently trading near its 52-week low of Rs 451.25, as against the previous high of Rs 1,135 per share.
With the present round of stake buy, Nalanda is averaging its investment in the company. Nalanda India Fund held 1.6 per cent stake in Voltamp, as of June, 2010, but significantly increased its exposure to 9.79 per cent by December last year. The share price of Voltamp was trading in the range of Rs 700-Rs 1,054 per share during this period.
Other investors in Voltamp include Samena Special Situations Fund and M3 Investments, the investment arm of Bilakhia Holdings.
Voltamp reported 3 per cent fall in sales in FY11 to Rs 526.3 crore, with net profit falling as much as 38 per cent to Rs 51.4 crore. For Q1FY12, the company reported 19 per cent fall in total income to Rs 100.6 crore.
“The transformer manufacturing sector has been going through a continued phase of margin pressure and subdued demand conditions. In general, the working capital cycle has gone up, thus constraining the cash flow. The distress in the industry is likely to persist in the near-to-medium term, given the moderating investments in power and industrial sector,” a recent report by Kotak Securities stated on the company.
Nalanda Capital, founded by former Warburg Pincus India MD Pulak Prasad, recently closed its second fund with commitments of $475 million. Its other investments include Page Industries, MindTree, Mastek, Triveni Engineering, Carborundum Universal and WNS.