Ashish Kacholia-backed multibagger forging stock with 6,000 per cent returns; Board to raise funds of Rs 496.80 crore through preferential issue for business expansion!
The stock gave multibagger returns of 125 per cent in just 1 year and a whopping 6,000 per cent in a decade.
Balu Forge Industries Ltd (BFIL), a leading precision engineering and manufacturing company, has announced a fund-raise of Rs 496.80 crore in a combination of preferential issue of equity shares and fully convertible warrants to strengthen its manufacturing capacity and capability to play its role in making India Atmanirbhar or self-reliant in defence, railways and aerospace sector and turning the vision of Viksit Bharat into reality.
The board of BFIL has approved an issue of 45,00,000 equity shares of the face value of Rs 10 each at a premium price of Rs 350 per equity share aggregating up to Rs 162,00,00,000 by way of preferential issue to the non-promoter public category investors. The board has also approved an issue of 63,00,000 fully convertible warrants to the non-promoter public category investors and 30,00,000 fully convertible warrants to the promoter category at an issue price of Rs 360 per warrant.
BFIL will majorly deploy a majority of the funds to undertake special R&D initiatives to further enhance the special engineering capability in the field of defence and aerospace components. The company will further add a new capability in the form of a Direct Drive Screw Press Line capable of producing aerospace and high-precision components and an SPM line for defence production. The product mix includes an extensive large portfolio covering railways, defence and aerospace industries.
BFIL is actively engaging with several companies globally for Transfer of Technology (ToT) and contract manufacturing agreements, especially in the space of defence, railways and aerospace. The company has plans to deploy capital to procure Solid Wheel Rolling Machinery which will help the company to produce railway wheels up to 1300 mm, one of the largest railway wheels globally. The company will be capable of supplying wheel sets (wheels and axle assembly) for 1,300 mm dia railways wheels. BFIL is working towards further enhancing its machining capacity to position itself as a leading precision machining player in the industry in terms of capacity and capability.
Today, shares of Balu Forge Industries Ltd (BFIL) gained 2.73 per cent to an intraday high of Rs 426.65 per share from its previous closing of Rs 415.30 per share. The stock’s 52-week high is Rs 428.65 and its 52-week low is Rs 154.55. The stock gave multibagger returns of 176 per cent from its 52-week low is Rs 154.55 per share.
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About the Company
Balu Forge Industries Ltd. (BFIL), established in 1989, is a leading manufacturer of precision-engineered forged components, including crankshafts, catering to a wide range of industries like automobiles, defence, railways and even the new energy sector. Not only do they adhere to the latest emission regulations and produce components for new energy vehicles, but they are also actively researching new materials for lighter and more advanced components. BFIL has grown into a prominent player with over 1,000 employees, a global export network reaching over 80 countries, and a trusted supplier to more than 25 original equipment manufacturers (OEMs). Their recent expansion includes cutting-edge production lines and a focus on R&D in alloy development, solidifying their position as a leader in high-end forging and a supplier of critical components across the globe.
According to Quarterly Results, the net sales increased by 64.5 per cent to Rs 147.08 crore and net profit skyrocketed by 122.3 per cent to Rs 25.45 crore in Q4FY24 compared to Q4FY23. In its annual results, the net sales increased by 14.2 per cent to Rs 326.64 crore and net profit increased by 30.4 per cent to Rs 38.91 crore in FY24 compared to FY23.
The company has a market capitalization of over Rs 4,200 crore and the shares of the company have an ROE of 22 per cent & an ROCE of 27 per cent. According to the shareholding pattern, Ashish Kacholia owns 21,90,500 shares or 2.14 per cent stake in the company as of June 2024. The stock gave multibagger returns of 125 per cent in just 1 year and a whopping 6,000 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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