Nitesh Estates soars 20% in early trade; here’s why

Shares of Nitesh Estates soared nearly 20 per cent in early trade on Thursday after reports that Shanghai-based Fosun Group is in advanced discussions to invest Rs 800 crore ($125 million) in the southern developer.

Billionaire Guo Guangchang-led Fosun, with more than $75 billion in assets, is likely to pick up around 50 per cent stake in the company as it looks to build a property platform to expand in the country, people directly familiar with the matter told TOI.

This would be Fosun's second buy in India after snapping up controlling shares in Hyderabad-based Gland Pharma in a billion-dollar deal last year.


Nitesh plans to issues shares to Fosun Property Holdings and IDERA Japan, which is controlled by the former, through preferential allotment.

The Bengaluru-based company's founder Nitesh Shetty will retain 25 per cent stake and continue to run operational management. The potential transaction would trigger a mandatory open offer by the company to public shareholders, though there are no delisting moves afoot now.

The scrip jumped 19.95 per cent to close at its fresh 52-week high of Rs 15.93 on Thursday. The stock had hit a 52-week low of Rs 7.13 on February 2, 2017.

On the BSE, 28.62 lakh shares were traded in the counter so far, compared with an average volume of 2.10 lakh shares in the past two weeks.