Axita Cotton shares jumped 12% to ₹7.67 per share on Friday, according to latest market data. The stock opened at ₹7.37 and touched an intraday high of ₹7.91, representing an 8.36% rise from the previous close. The small-cap penny stock has shown strong recovery momentum, delivering a 16.74% return from its 52-week low of ₹6.57 per share. The stock's 52-week high stands at ₹12.20 per share, while it has shown mixed performance with a 5.35% weekly gain and 3.5% monthly increase, though it remains 19% lower over six months and 32% year-to-date.
In an exchange filing dated August 21, 2026, Axita Cotton announced its submission of Expression of Interest for participation in the Corporate Insolvency Resolution Process (CIRP) of Varidhi Cotspin Private Limited, as reported by Live Mint. The Ahmedabad bench of the National Company Law Tribunal (NCLT) had initiated CIRP against Varidhi Cotspin over a plea filed by public sector lender SBI over a default of ₹43.39 crore earlier this year on June 22. Varidhi Cotspin is a cotton yarn manufacturer based in Dholka, Ahmedabad, Gujarat, with its manufacturing unit established in 2017. The company operates a spinning facility housing 29,184 spindles with a spinning unit capacity of approximately 4,442 metric tonnes per annum (MTPA). Varidhi produces Ring Spun 100% Cotton, Compact, Combed and Carded Yarn for the hosiery and weaving industries.
According to the company's statement reported by Live Mint, Axita Cotton is keen to acquire Varidhi Cotspin Private Limited through the Insolvency and Bankruptcy Code (IBC) process. The acquisition represents a deliberate strategy to move downstream in the cotton value chain—from ginning and bale production into yarn manufacturing—leveraging the Insolvency and Bankruptcy Code (IBC) route to acquire complementary capacity at potentially attractive valuations. The proposed participation in Varidhi's CIRP represents a strategic opportunity for Axita Cotton to expand its business operations and explore potential synergies between cotton and yarn manufacturing. Under the Insolvency & Bankruptcy Code framework, once a company is admitted into CIRP, the Resolution Professional (RP) invites EoIs from prospective resolution applicants, typically via public announcement. The RP examines EoIs against Section 29A of the IBC, which bars certain categories of persons from submitting resolution plans, with only eligible applicants shortlisted as Prospective Resolution Applicants (PRAs) to access the Information Memorandum and prepare detailed resolution plans.
The stock has demonstrated strong investor interest following the CIRP announcement, with participation in the resolution process viewed as a strategic expansion move. Axita Cotton currently has a market capitalization of ₹293.55 crore, reflecting its established position in the cotton industry. The company's focus on quality manufacturing and export operations, combined with its 16.74% recovery from the 52-week low, indicates positive market sentiment toward the proposed acquisition strategy. As of 16:00 IST, the shares closed at ₹7.67 per share, showing continued momentum from the morning session. The company's established presence in the cotton industry provides a strong foundation to explore opportunities in complementary segments of the textile value chain.
