Shares of Tube Investments of India (TII), the flagship company of Murugappa Group, jumped 7% to hit an all-time high on Tuesday after its arm acquired a majority stake in an EV startup. Investors are betting high on TII’s plan to expand its footprint in clean mobility, with the share price surging 38% in the last one month as the component supplier gears up to enter the electric vehicle (EV) segment by introducing electric three-wheeler and tractors.

Extending its rally for the fourth straight session, Tube Investments share price opened higher at ₹2,030 and gained as much as 7% to touch a fresh life-time high of ₹2,154.65 on the BSE. The share price has gained nearly 8% in a week and over 13% in the calendar year 2022. With a market capitalisation of ₹41,503.6 crore, the largecap stock has delivered 94% returns to its shareholders in the past one year. In the long term horizon, the stock has given 445% returns in 3 years and 746% in 5 years.

Tube Investments recently ventured into the electric mobility business by forming its new subsidiary TI Clean Mobility with an initial investment of ₹200 crore to consolidate and focus on its clean mobility businesses. To further boost its presence in the EV segment, the company acquired Cellestial E- Mobility, a manufacturer of electric tractors, and also purchased an equity stake in Aerostrovilos, a startup developing micro gas turbine technology for power generators and automotive applications.

In a fresh development, TI Clean Mobility (TICMPL), a wholly owned subsidiary of TII, has signed agreements to acquire about 65% equity stake in an electric heavy commercial vehicle company, IPL Tech Electric Private Limited (IPLT). Based in Gurgaon (Haryana), IPTL is a startup engaged in the manufacturing and sale of electric heavy commercial vehicles.

“The proposed acquisition by TICMPL is in line with the intent to broaden its product and business portfolio with a view to reduce its dependence on existing revenue streams,” the company says on Monday.

The acquisition would be through a combination of primary and secondary purchases of equity shares for a total consideration of about ₹246 crore. This includes the acquisition of 5,380 equity shares for ₹96 crore from the founders and other shareholders of IPLT, and up to ₹150 crore towards subscription to 8,456 equity shares of IPLT.

The deal is expected to be completed on or before October 31, 2022, subject to the satisfactory completion of certain conditions executed between the parties.

M.A.M Arunachalam (known as Arun Murugappan), chairman of the company says, "The acquisition of IPL Tech Electric has expanded our footprint in the clean mobility space and gives us a first mover advantage in this segment. We have taken another important step to further our vision of improving quality of life through eco-friendly mobility solutions and to drive our ESG goals.”

Follow us on Facebook, X, YouTube, Instagram and WhatsApp to never miss an update from Fortune India. To buy a copy, visit Amazon.