CEAT Shares Soar 10% After Major Michelin Deal Worth ₹1,905 Crore

The Indian markets have opened on a relatively positive note on Monday, December 9. The beginning of the new trading week is even more euphoric for CEAT, the RPGG group-owned tyre-making company made major advances in the day's trade. In the early hours of the intraday trade, the company shares rocketed by over 10 per cent.

CEAT's Big Deal

This development at Dalal Street comes to pass after CEAT closed a major deal with French tyre giant Michelin.

The Mumbai-based company, with its origins in Italy's Turin, announced that it is all set to take over the French company's subsidiary, Camso off-highway construction equipment bias tyres and tracks business. This deal would see a transfer of Rs 1,905 crore or about USD 225 million.

This new deal will give the company an edge in the global high-margin off-highway tyres (OHT) segment.

Camso, the subsidiary of French giant, Michelin is a Canadian company with a history of over 40 years and with services in the United States and Europe.

Shares Of CEAT Rocket

When we look at the progress of the shares of CEAT on Monday, the company shares as mentioned before soared to new heights.

After the early 10 per cent gain, CEAT shares high the day high of Rs 3,449.00, before slumping a little. At 10:25 IST, the shares of the famed tyre-maker rose by 10.46 per cent or a mammoth Rs 323.95 in the just an hour of trade.

This could be seen as investors depositing their faith in the potential of this deal and what this could mean for the company. In all, this surge took the overall value of the company shares to Rs 3,419.65 per share, after the previous day's close of Rs 3,095 per share.

Thanks to this surge on Monday, the overall gains made in the past month increased by over 19 per cent or over Rs 550 per share.