Sharvaya Metals to buy Success Electronics in Rs 30.24 crore share swap, adds die-casting capability

Sharvaya Metals Ltd has approved the acquisition of 100 per cent of Success Electronics Private Ltd through a non-cash share swap valued at up to Rs 30.24 crore, a move that would add aluminium high-pressure die-casting capabilities to its existing aluminium extrusion, machining and electric-vehicle component operations.

The board approved the transaction at its meeting on October 14, 2026. Sharvaya will issue up to 21 lakh fully paid-up equity shares at Rs 144 apiece to the shareholders of Success Electronics in exchange for its entire 2 lakh-share capital. The agreed swap ratio is 21 Sharvaya shares for every two Success Electronics shares.

Following completion, Success Electronics will become a wholly owned subsidiary, marking Sharvaya’s first subsidiary acquisition after the company reported no subsidiaries, joint ventures or associates as of March 31, 2026.

The transaction gives Sharvaya access to Success’s aluminium high-pressure die-casting operations, which include 218-tonne and 418-tonne HPDC machines. Success manufactures aluminium casting components for electric vehicles and other automotive applications, providing a manufacturing capability that complements Sharvaya’s existing portfolio of alloyed ingots, billets, extrusions, dies, precision-machined parts and EV battery housings.

Sharvaya plans to install a 900-tonne high-pressure die-casting machine and an automated powder-coating facility focused on critical components at Success Electronics. The proposed investments are intended to enable the manufacture of larger and more complex aluminium components, while adding finishing capability to the acquired business.

The integration would create an aluminium manufacturing platform spanning alloy manufacturing, extrusion, die casting, die and mould manufacturing, precision machining and finishing. For Sharvaya, which has positioned itself around integrated aluminium processing, the acquisition potentially fills a key gap between its alloy and extrusion operations and the growing requirement for complex cast automotive and EV parts.

Success Electronics reported revenue of Rs 10.36 crore and profit after Tax of Rs 1.01 crore for FY2025-26. Its revenue represented about 4.5 per cent of Sharvaya’s FY2025-26 standalone revenue from operations of Rs 229.83 crore, while its profit was equivalent to roughly 8.7 per cent of Sharvaya’s FY2025-26 profit after tax of Rs 11.67 crore. Success reported turnover of Rs 4.48 crore and net profit of Rs 88.61 lakh for the half-year ended September 30, 2026.

The target’s FY2025-26 net profit margin works out to about 9.7 per cent, compared with Sharvaya’s standalone net margin of about 5.1 per cent in the same financial year. However, the two businesses operate in different parts of the aluminium manufacturing chain, and the eventual financial effect will depend on integration, capacity addition and demand from automotive and EV customers.

Sharvaya said Success is profitable and has zero Bank debt. Its financial results will be consolidated into Sharvaya’s accounts after the transaction is completed.

Separately, the board approved a preferential issue of up to 8.11 lakh fully convertible warrants at Rs 144 each, aggregating to Rs 11.68 crore. The warrants will be issued for cash and can be converted into an equal number of equity shares within 18 months. Investors will pay 25 per cent of the issue price at allotment and the balance upon exercise.

At 2:57 pm on October 14, 2026, Sharvaya Metals shares were trading at Rs 200.00, down 0.42 per cent from the previous close of Rs 200.85. The stock was about 0.4 per cent below its 52-week high of Rs 200.85 and substantially above its 52-week low of Rs 79.15. The Rs 144 share issue price is 28 per cent below the indicated market price.

The acquisition and swap-share allotment remain subject to shareholder and stock-exchange approvals. Sharvaya expects completion within 15 days of receiving the later of the required approvals. The company has also proposed an increase in authorised share capital and will convene an extraordinary general meeting for the related approvals.

Disclaimer: The article is for informational purposes only and not investment advice.