Rupa & Company shares rally on unit’s deal with Berkshire arm

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NEW DELHI: Shares of Rupa & Company advanced as much as 16.34 per cent in early trade on Wednesday after the company informed bourses that its wholly-owned subsidiary Oban Fashions has entered into a License Agreement with Fruit of the Loom Inc, a subsidiary of Berkshire Hathaway Company, to manufacture innerwear and outerwear products for men, boys, women, girls and toddlers in India, under their brand names and marks.

The scrip was trading 11 per cent up at Rs 305. Shares of the hosiery company opened at Rs 292.50 and touched a high and low of Rs 319.70 and Rs 292.50, respectively. Benchmark BSE Sensex was trading 25.94 points, or 0.09 per cent, down at 29,414.59.

Fruit of the Loom is a US brand set up in 1851 to manufacture innerwear and outerwear products.

Oban Fashions in 2016 had secured an exclusive license from the UK-based French Connection to develop, manufacture, market and sale ‘FCUK’ innerwear and related products.

For the quarter ended December 31, 2016, the company reported a net profit of Rs 17 crore, up 20.65 per cent, against Rs 14.09 crore in the corresponding quarter last year. Net sales of the company declined 7.47 per cent year-on-year to Rs 208.57 crore for the quarter under review.

In the past one year, share price of Rupa & Company gained 0.48 per cent to Rs 274.80 till March 14, whereas benchmark BSE Sensex advanced nearly 20 per cent during the same period.