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Business News/ Markets / Stock Markets/  TRF stock hits 20% upper circuit for 2nd straight day, up 54% in 5 sessions – here's why
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TRF stock hits 20% upper circuit for 2nd straight day, up 54% in 5 sessions – here's why

Shares of TRF, a Tata Group company, hit the 20% upper circuit limit, reaching an eight-year high of ₹393.30 apiece, following the decision against proceeding with the amalgamation process.

With the active support from Tata Steel, TRF has successfully navigated a highly challenging operating environment, witnessing a turnaround in its business performance. (Pixabay)Premium
With the active support from Tata Steel, TRF has successfully navigated a highly challenging operating environment, witnessing a turnaround in its business performance. (Pixabay)

Continuing their robust momentum, shares of TRF, a Tata Group company, hit the 20% upper circuit limit in today's trade, reaching a peak not seen in eight years at 393.30 apiece. 

This marks the second consecutive trading session when the company's shares were locked in the 20% upper circuit limit, following the decision of both the parent company and TRF against proceeding with the amalgamation process. This robust rally has pushed the stock to gain 54% in just five trading sessions.

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In an exchange filing on Wednesday, Tata Steel said that "the boards of both companies have decided not to pursue the amalgamation process. Since the announcement of the intended merger of TRF in September 2022, Tata Steel has been providing significant operational and financial support by way of the placement of orders and the infusion of funds."

TRF was among the strategic businesses that Tata Steel considered for amalgamation, alongside eight others, including Tata Steel Long Products, Tinplate Company of India, Tata Metaliks, The Indian Steel & Wire Products, Tata Steel Mining, S & T Mining Company, Bhubaneswar Power and Angul Energy. 

However, with the active support from Tata Steel, TRF has successfully navigated a highly challenging operating environment, witnessing a turnaround in its business performance. Tata Steel said it will continue with its simplification journey and leverage relevant opportunities in the future.

Also Read: Tata Steel completes proposed amalgamation of five of nine subsidiaries

On the other hand, Tata Steel has successfully amalgamated five of its nine strategic businesses, in line with its long-term strategy and commitment to simplify its business portfolio. In the filing, the company said the integration of the five businesses was underway after it completed the regulatory processes.

The five companies being integrated are Tata Steel Mining Ltd, Tata Steel Long Products Limited, S&T Mining Company Limited, The Tinplate Company of India Ltd, and Tata Metaliks Limited.

“The merger of five companies with a cumulative annual turnover of 19,700 crore in FY23, in record time, presents a unique opportunity for consolidation of the downstream operations. This will enable growth in value-added segments by leveraging Tata Steel’s nationwide marketing and sales network," said Tata Steel.

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The company further stated that the merger process for three other companies—Bhubaneswar Power Private Limited (a wholly-owned subsidiary of Tata Steel), Angul Energy Limited (Tata Steel's shareholding is 99.99%), and The Indian Steel and Wire Products Limited (Tata Steel's shareholding is 98.15%)—is in its final stages with the respective jurisdictional company law tribunals. It is anticipated to be finalised by Q1FY25, pending regulatory approvals, the company added. 

 

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.

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Published: 08 Feb 2024, 12:39 PM IST
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