Tata Group stock rises 16% in afternoon trade; here’s why

Shares of Nelco Ltd, a Tata Group firm, zoomed over 16% today after the stock turned ex-dividend for a dividend of Rs 2 per share. Sentiments turned positive around the stock after the company inked an agreement with the promoters and other shareholders of Piscis Networks. Nelco stock zoomed 16.52% to Rs 739 against the close of Rs 634.50 in the previous session. In the current session, Nelco stock opened at Rs 646.10 on BSE.

Market cap of the firm rose to Rs 1668 crore. Total 2.04 lakh shares changed hands amounting to a turnover of Rs 14.34 crore on BSE. Nelco stock has gained 11.7% in a year and risen 2 per cent in 2023. Nelco stock hit a 52-week low of Rs 487 on March 28, 2023 and a 52 week high of Rs 1089.95 on September 2, 2022.

In terms of technicals, the relative strength index (RSI) of Nelco stood at 63.7, signaling it's trading neither in the overbought nor in the oversold zone. Nelco stock has a one-year beta of 0.7, indicating low volatility during the period. Nelco shares are trading higher than the 5 day, 20 day, 50 day, 100 day and 200 day moving averages.

Nelco has agreed to make an initial investment of Rs 99,99,100 to subscribe to 1,111 equity shares of Rs 10 each. This initial investment represents 9.09 percent of the paid-up capital of Piscis Networks, the company said.

Additionally, Nelco has the option to make further investments in order to increase its shareholding to at least 30 percent of the paid-up capital of Piscis Networks. However, these investments are subject to the necessary approvals and consents required by applicable law, the company said.

Nelco is engaged in the business of providing systems and solutions in the areas of very small aperture terminal (VSAT) connectivity and integrated security & surveillance. The company operates in one reportable segment, which is network systems consisting of SatCom Services (including equipment sale, maintenance, and other allied services).

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