Multibagger Defence Stock Hits Upper Circuit; Secures Order Worth Rs 43.89 Crore – Profit Surges 180 Per cent, Margins Nearly Double in Q2 FY25

The company’s shares have delivered an impressive multibagger return of over 540 per cent in just 2 years.

Tembo Global Industries Ltd is a manufacturer and fabricator of metal products used in pipe support systems, fasteners, anchors, HVAC, anti-vibration systems, and equipment for industrial, commercial, utility, and OEM installations. The company registered a significant spike in its share price today resulting in hitting the upper circuit.

The reason for today’s spike is probably due to the company has secured an order from a domestic organization for a water irrigation project valued at Rs 43,89,00,392 (Rupees Forty-Three Crore Eighty-Nine Lakh Three Hundred Ninety-Two Only). The project is scheduled to be executed over a period of 12 months.

The company specializes in the fabrication and installation of ductile pipes, HDB pipes and fittings, and MS plates. Its products are certified and approved by Underwriter’s Laboratory Inc. (USA) and FM Approvals (USA) for fire sprinkler system installations.

Financial Performance

The company has announced stellar Quarterly Results and in Q2 FY25, Tembo Global Industries Ltd recorded a revenue of Rs 164 crore compared to Rs 109 crore representing a growth of 50 per cent YoY. The operating profit stood at Rs 15 crore with an operating margin of around 9 per cent. The net profit stood at Rs 14 crore compared to a profit of Rs 5 crore representing a growth of around 180 per cent YoY.  The net profit margins nearly doubled in the same period.

Looking at the annual performance, the company generated a revenue of Rs 432 crore in FY24. The operating profit for FY24 was Rs 19 crore with a net profit of Rs 14 crore compared to a net profit of Rs 6 crore in FY23.

Stock Performance

Today, the shares of Tembo Global Industries Ltd hit the upper circuit and are at around Rs 709.25 per share on the NSE. The company’s current market capitalization stands at Rs 787.53 crore. Additionally, the shares have delivered an impressive multibagger return of around 195 per cent in the past 1 year only.

Strategic Partnership in Defence Manufacturing

Recently in the month of September, TGIL announced a major strategic partnership with a prominent European company to establish a cutting-edge arms and ammunition manufacturing facility in India. This newly signed MoU represents a significant milestone for Tembo Global as it ventures into the defence manufacturing sector, backed by a well-established international partner.

A key component of the agreement is a strategic buy-back arrangement, under which the European company will purchase a substantial portion of the firearms produced by Tembo Global. This move strengthens Tembo Global's presence in the defence industry and bolsters its operational capabilities.

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