Shares of Patanjali Foods hit a record high today (July 2) after the Baba Ramdev-led firm’s board approved proposal to buy its parent company Patanjali Ayurved’s home and personal care business for 1,100 crore. Patanjali Foods shares rose 4% to a high of 1769.15 on July 2 compared to the previous close of 1699.65 on BSE. The company’s shares have gained 44.17% in a year and risen 9.16% since the beginning of this year.

A hoarding with an image of Baba Ramdev is seen inside a Patanjali store in Ahmedabad, India.(Reuters)

On the BSE, total 1.16 lakh shares changed hands amounting to a turnover of 20.13 crore and the market capitalisation of the firm rose to 62,140 crore.

The company said in an exchange filing, “The board of Patanjali Foods Ltd has approved the proposal of Patanjali Ayurved Ltd’s to acquire its Home and Personal Care Business, accelerating the company’s transition into a leading FMCG company. The HPC business of PAL currently has a strong brand equity in India’s FMCG space and enjoys a loyal consumer base across the country. It presently caters to four key segments, being (i) dental care, (ii) skin care, (iii) home care, and (iv) hair care.”

It added, “The transfer has been mutually negotiated for a lump sum consideration of 1,100 crore, which shall be subject to customary closing date adjustments and on such other terms as set out in the business transfer agreement. The acquisition will lead to a consolidation of ‘Patanjali’ brand FMCG products portfolio. The acquisition will bring along with it multiple key synergies in terms of brand equity and enhancements, product innovations, cost optimisation, infrastructure & operational efficiencies and positive impact on market share.”