1:1 bonus share & Rs 140 crore order book: Multibagger engineering stock with 5,270 per cent returns, hit upper circuit & 52-week high on July 29; do you own it?

The company has a market cap of over Rs 2,600 crore and it is almost debt-free as its current debt is just 1.67 crore which is just 0.07 per cent of its market cap.

On Monday, shares of Rajoo Engineering Ltd jumped 5 per share upper circuit to Rs 431.25 per share from its previous closing of Rs 410.75. The stock also made a new 52-week high of Rs 431.25 per share while its 52-week low is Rs 46.25 per share. At the closing bell, shares of the company were trading at Rs 429.70 per share, up 4.61 per cent with a spurt in volume by more than 1.10 times on BSE.

Rajoo Engineers Ltd, founded in 1986 by C.N. Doshi and R.N. Doshi in Gujarat, designs and manufactures plastic extrusion machinery like blown film lines and lamination lines. They also cater to specific client needs with customized solutions. Notably, Rajoo Engineers Ltd established Asia's first R&D center dedicated to their customers, allowing them to test-run products and develop fully customized solutions. This focus on innovation has led them to create extrusion coating and lamination machines, a more efficient alternative to traditional adhesive lamination for various packaging applications.

According to consolidated Quarterly Results, the net sales increased by 63 per cent to Rs 50.87 crore, operating profit increased by 98 per cent to Rs 8.20 crore and net profit skyrocketed by 117 per cent to Rs 5.34 crore in Q1FY25 compared to Q1FY24. In its annual results, the net sales increased by 23.5 per cent to Rs 197.35 crore, operating profit increased by 42.4 per cent to Rs 30.62 crore and net profit skyrocketed by 96.8 per cent to Rs 19.71 crore in FY24 over FY23.

The Board of Directors of the company Considered, approved and recommended the issue of bonus equity shares in the ratio of 1:1 i.e. 1 new fully paid equity share for every 1 existing equity share held and recommended a final dividend of 25 per cent i.e., Rs. 0.25 per equity share having face value of Rs 1 (pre-bonus) for the financial year ended March 31, 2024. The record date for bonus shares is fixed as Thursday, August 08, 2024

The company has announced a significant expansion of its Rajkot facility, investing in an 18,000 sq. ft, 100 ft high production plant and an additional 7,000 sq. ft for the QCA, boosting manufacturing capacity by 30 per cent. Simultaneously, a partnership with Rajoo Engineers Limited and Promoter Group Entities has led to the formation of Shrutina Nexgen Solar LLP to leverage solar energy, aligning with the government's solar power utilization scheme and fostering ESG compliance. The company has also launched the Proex series of high-performance blown film lines, capable of producing 900 kg/hr of 22-micron thick film with a 2800 mm lay flat width. Utilizing RELEX 4.0 extruders and CSD 4.0 die technology, the line achieves unprecedented speeds of 150 m/min and offers film thickness from 20 to 200 microns. As of June 2024, the company boasts an order book of Rs 140 crore.

The company has a market cap of over Rs 2,600 crore and it is almost debt-free as its current debt is just 1.67 crore which is just 0.07 per cent of its market cap. The stock gave multibagger returns of 806 per cent in just 1 year, 1,215 per cent in 3 years and a whopping 5,270 per cent in a decade. Investors should keep an eye on this Small-Cap stock.

Disclaimer: The article is for informational purposes only and not investment advice. 

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