FIIs bought 5 crore shares: Multibagger penny stock under Rs 40 from textile sector jumps 10 per cent today with heavy volume!

The stock gave multibagger returns of over 160 per cent from its 52-week low of Rs 14.28 per share.

Today, shares of Vishal Fabrics Ltd jumped 10 per cent to an intraday high of Rs 37.23 per share from its previous closing of Rs 33.86. The stock gave multibagger returns of over 160 per cent from its 52-week low of Rs 14.28 per share. The shares of the company saw a spurt in volume by more than 1.10 times on BSE.

Vishal Fabrics Ltd, a textile company established in 1985 and part of the Ahmedabad-based Chiripal Group, manufactures and distributes a wide range of fabrics including dyed yarn, denim, and custom textile work. Certified for quality and sustainability, they specialize in dyeing, printing, and processing denim and other fabrics for both their collections and client-specific jobs.

Their fabrics come in various compositions like 100 per cent cotton, cotton blends, and modal, and they are a leading supplier of stretch denim. With a focus on innovation, they offer diverse finishes, weaves, blends, and colours. Their extensive production capacity comes from multiple facilities in Ahmedabad, Gujarat, and they boast an impressive list of clientele including well-known international fashion brands. The company has a market cap of over Rs 700 crore.

According to Quarterly Results, the total income increased by 3.6 per cent to Rs 340.10 and net profit increased by 106 per cent to Rs 4.78 in Q1FY25 compared to Q1FY24. In its annual results, the company reported net sales of Rs 1,450 crore and net profit of Rs 21 crore in FY24.

Additionally, The Board of Directors has approved raising funds through the issuance of 5,00,00,000 compulsorily convertible equity warrants (Warrants) to non-promoter public investors on a preferential basis. Each Warrant can be converted into one equity share of Rs 5 at an issue price of Rs 30.60 per Warrant. The total amount to be raised is approximately Rs 153,00,00,000. The Warrants will be allotted to specific investors, including Silver Stallion Limited (1,50,00,000 Warrants), Vikasa India EIF I Fund (1,00,00,000 Warrants), North Star Opportunities Fund VCC Bull Value Incorporated VCC Sub-Fund (75,00,000 Warrants), Eminence Global Fund PCC- Eubilia Capital Partners Fund I (75,00,000 Warrants), Nexpact Limited (50,00,000 Warrants), and AG Dynamic Funds Limited (50,00,000 Warrants). The Warrants have a validity of 18 months and can be converted into one or more tranches. An initial payment of 25 per cent of the Warrant price is required upon allotment, with the remaining 75 per cent payable upon conversion.

In addition to the Warrant issuance, the Board has approved raising up to Rs 100 crore through a Qualified Institutions Placement (QIP) of equity shares with a face value of Rs 5 each. The QIP will be subject to shareholder and regulatory approvals. Following the potential conversion of Warrants and completion of the QIP, the shareholding pattern would change. Pre-preferential issue, promoters held 69 per cent of the shares, while the public held 31 per cent. Post-preferential issue and assuming full Warrant conversion, promoter shareholding would decrease to 55.07 per cent, and public shareholding would increase to 44.93 per cent.

Investors should keep an eye on this micro-cap stock.  

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

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