FIIs bought 10,41,65,000 shares of this multibagger penny stock under Rs 10: Company sets up JV to manufacture smart meters; hit 52-week high!

The stock gave multibagger returns of 178.2 per cent from its 52-week low of Rs 2.66 per share.

Traders across India welcomed Makar Sankranti with open arms and open wallets, sending the BSE Sensex soaring 0.90 to a fresh 52-week high of 73,235.81. The festive spirit, marked by the tradition of kite flying, seemed to translate into bullish sentiment on Dalal Street.

Along with the market in green, one multibagger penny stock under Rs 10 gained over 10 per cent in the pre-opening session. The stock we are talking about today is Vikas Lifecare Ltd.

Vikas Lifecare Ltd, a leading trader and manufacturer of polymer, rubber compounds and additives for plastics, synthetic & natural rubber, infra, agro products, FMCG products, etc.

Vikas Lifecare Limited announced that its subsidiary company Genesis Gas Solutions Pvt Ltd. (Genesis) has accomplished the incorporation of “IGL Genesis Technologies Limited” the joint venture company with Indraprastha Gas Limited (IGL). IGL Genesis Technologies Limited has been incorporated with equity participation from Indraprastha Gas Limited (IGL) and Genesis Gas Solutions Pvt Ltd. (Genesis) in the ratio of 51:49 respectively. With the incorporation of “IGL Genesis Technologies Limited”, Genesis Gas Solutions Pvt Ltd has completed the inducement of its share of the Paid-Up capital amounting to Rs 18.1 crore in the newly incorporated entity focusing on manufacturing smart meters.  

IGL Genesis, a joint venture between Genesis Gas Solutions and Indraprastha Gas Limited, will build India's first state-of-the-art smart meter manufacturing plant for Rs 108 crore. The plant, located in Noida, will initially produce 10 lakh meters annually with IoT features and in-built analytics, targeting July 2024 for operation.

Additionally, Foreign Institutional Investors (FIIs) bought 10,41,65,000 shares via preferential issue of shares. Coeus Global Opportunities Fund bought 4,16,50,000 shares, AG Dynamic Funds Limited bought 3,17,90,000 shares and Nakshatra Stressed Assets Fund bought 3,07,25,000 shares.

Furthermore, to boost its polymer & rubber business, Vikas Lifecare acquired land for Rs 3 crore to expand existing factories in Rajasthan. This Rs 26 crore project, including equipment costs, will be operational in 3-4 months and is expected to add Rs 60 crore to annual revenue. The company actively seeks both vertical and horizontal growth opportunities, including potential mergers and acquisitions.

According to the Quarterly Results, the company's net sales decreased by 12 per cent to Rs 116.03 crore and net profit skyrocketed by 206 per cent to Rs 7.65 crore in Q2FY24, compared to Q2FY23. In H1FY24, net sales decreased by 4.05 per cent to Rs 214.93 crore and net profit skyrocketed by 278.02 per cent to Rs 19.35 crore in H1FY24, compared to H1FY23.

In FY23, the net sales increased by 58.2 per cent to Rs 476.05 crore compared to FY22 while the company reported a net loss of Rs 15.55 crore in FY23 compared to a net profit of Rs 28.92 crore in FY22. The company has a market cap of Rs 1,100 crore.

Today, shares of Vikas Lifecare gained 14.55 per cent and a fresh new 52-week high of Rs 7.40 per share from its previous closing of Rs 6.46. The stock gave multibagger returns of 178.2 per cent from its 52-week low of Rs 2.66 per share. Investors should keep an eye on this micro-cap stock.

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