Hero Honda scrip zooms 11% in early trade

Shares of motorcycle giant Hero Honda surged over 11 per cent in early trade on the Bombay Stock Exchange on Monday, following Munjals-promoted Hero Group's announcement last week that it will acquire the entire 26 per cent stake held by its Japanese partner, Honda, in the JV company.

The two-wheeler manufacturer's shares started the day on a robust note and climbed 11.42 per cent to touch an early-high of Rs 1,871 per piece on BSE. Witnessing a similar surge on the National Stock Exchange, the scrip soared 11.3 per cent to trade at Rs 1,871.80 in the opening trade.

Significant rise in the Hero Honda scrip helped the 30-share barometer Sensex offset its weakness in the early trade. The key index was quoting at 19,778.42, down 86.43 points from previous close at 10.33 am.

In the 26-year old joint venture - Hero Honda - both Hero Group and Honda had 26 per cent stake, each. As part of a new licensing agreement with Honda, the Hero Group will buy Honda's 26 per cent stake for an undisclosed amount.