R K SWAMY Promoters Acquire 3.56% Stake, Boost Holdings to 69.6%

R K SWAMY, a leading integrated marketing services group listed on the BSE and NSE, has taken a significant step to consolidate its ownership. On December 27, 2024, promoters Srinivasan K Swamy and Narasimhan K Swamy successfully acquired a 3.56% stake in the company, previously held by the Evanston Pioneer Fund L.P., a US-based investor that joined the group in 2018-19.

The transaction, executed at the market price of Rs 249.64 per share, boosts the Promoter and Promoter Group’s holding to 69.6% of the company’s equity paid-up capital, marking a pivotal move during a challenging phase for the business.

Despite the promoters’ increased commitment, R K SWAMY is facing financial headwinds. For the half-year ending September 30, 2024, the company reported a total income of Rs 139.6 crore, a slight dip from Rs 142.6 crore in the same period last year.

Profits have seen a sharper decline. In the first half of 2024, the company’s profit before tax stood at Rs 5.3 crore, down significantly from Rs 10.9 crore during the same period in 2023. The second quarter was particularly tough, with total income dropping to Rs 68.1 crore from Rs 80.6 crore in the corresponding quarter of 2023. Profit before tax for the quarter fell to Rs 2.2 crore, a stark contrast to the Rs 10.2 crore achieved in the same quarter last year.

Amid financial pressures, R K SWAMY demonstrated resilience by adding over 15 new clients across its diverse service areas. This achievement underscores the company’s strong market presence and its ability to adapt and innovate even in a challenging business environment.

The stake acquisition signals the promoters' long-term confidence in the company and their determination to navigate current challenges. By consolidating their ownership, the Swamy family aims to strengthen the company’s strategic direction, leveraging its deep industry expertise to secure growth opportunities in the competitive marketing services landscape.

With the promoters’ renewed commitment, R K SWAMY is poised to overcome short-term hurdles and lay the groundwork for future success.