5:1 Bonus Share & Rs 1,800 Crore Order Book: Multibagger Solar Pumps Manufacturer Invests Rs 4,00,00,000 in Its Subsidiary for Business Expansion

The stock gave multibagger returns of 500 per cent from its 52-week low of Rs 155.17 per share.

On Monday, shares of Shakti Pumps (India) Limited (SPIL) hit a 5 per cent upper circuit to Rs 931 per share from its previous closing of Rs 886.70 per share. The stock also made a new 52-week high of Rs 931 per share and its 52-week low is Rs 155.17 per share. The stock gave multibagger returns of 500 per cent from its 52-week low of Rs 155.17 per share.

Shakti Pumps (India) Limited has invested a significant sum of Rs 4 crore in its wholly-owned subsidiary, Shakti Energy Solutions Private Limited (SESPL). This investment was made by subscribing to 4 crore equity shares of Rs. 1 each. SESPL, incorporated in 2010, specializes in the manufacturing of solar structures and has been steadily growing its business, with a turnover of Rs. 139.59 crore in FY24.

This strategic investment aims to bolster SESPL's operations and expand its business within the solar energy sector. As a wholly-owned subsidiary, SESPL's activities align with Shakti Pumps' core business objectives. The company's consistent growth over the past three years, with turnovers of Rs. 139.59 crore, Rs. 99.15 crore, and Rs. 154.63 crore in FY24, FY23, and FY22, respectively, demonstrates its strong market position. This investment is expected to further solidify SESPL's position and contribute to the overall growth of Shakti Pumps.      

Earlier, secured a significant contract from the Maharashtra State Electricity Distribution Company Limited for the supply and installation of 25,000 Stand-alone Off-Grid DC Solar Photovoltaic Water Pumping Systems (SPWPS) across the state of Maharashtra under the Magel Tyala Saur Krushi Pump Scheme. This domestic contract, valued at approximately Rs. 754.30 Crores (inclusive of GST), entails the design, manufacture, supply, transportation, installation, testing, and commissioning of these solar water pumps. The company is obligated to complete the project within a stringent timeframe of 60 days from the issuance of the Notice to Proceed (NTP) or work order.

Furthermore, the shares of the company ex-traded bonus Shares in the ratio of 5:1, i.e., 5 new fully paid-up equity shares for every 1 existing fully paid-up equity share. The ex-date for bonus shares was Monday, November 25, 2024.

About the Company

Shakti Pumps, a leading Indian manufacturer of pumps and motors for various applications like irrigation and domestic water supply, has been at the forefront of innovation with its well-regarded "Shakti" brand. Founded in 1982, they specialize in energy-efficient pumps including solar options and manufacture a wide range of components in-house for complete solar pump solutions. Committed to sustainability and transforming agriculture, Shakti Pumps exports its products to over 100 countries and is India's first 5-star rated pump manufacturer.

The company has a market cap of Rs 11,192 crore and as of September 30, 2024, the company has an unexecuted order book of Rs 1,800 crore. In Q2FY25, the company witnessed significant growth, with Revenue from Operations surging to Rs 634.6 crore, a substantial increase of 315.3 per cent compared to Rs 152.8 crore in Q2FY24. Similarly, Profit After Tax (PAT) for the quarter reached Rs 101.4 crore, a remarkable 1618.6 per cent increase from Rs 5.9 crore in the same period last year.

For the first half of FY25 (H1FY25), revenue climbed to Rs 1,202.2 crore, a 352.3 per cent increase over H1FY24's Rs 265.8 crore. PAT for the period grew to Rs 194.1 crore, a staggering 2,713 per cent increase in H1FY25 from Rs 6.9 crore in H1FY24. The stock gave multibagger returns of 460 per cent in 1 year and a whopping 2,625 per cent in 5 years. Investors should keep an eye on this solar pump stock.

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