Narayana Murthy invested in this aerospace and defense multibagger stock with huge order visibility; Could it replicate Infosys' success in the next decade?

The company's order backlog stands tall and stable at Rs 2,499.7 crore, a testament to their resilience.

On Friday, the Nifty embarked on a rollercoaster ride, opening more than 100 points down at 19,655, only to plummet further to 19,635, seemingly destined for a gloomy day. However, as the day unfolded, it staged a remarkable recovery, soaring to a day's high of 19,805 during the later part of the session. Alas, Nifty couldn't maintain that lofty position, succumbing to profit-taking in the final hour and ultimately concluding the session at 19,751, down by 43 points.

But the intrigue and excitement don't end there. For the week, Nifty has painted a promising picture with a long bullish candlestick pattern on the weekly chart, sporting minor upper and lower shadows. This follows a hammer-like candlestick pattern the previous week, hinting at a potential upward trend. Nifty managed to notch up half a per cent in gains over the week.

Zooming out, it's not just the Nifty that's basking in green glory. The broader indices, including Nifty Mid-Cap and Small-Cap, also joined the winning party, notching up about half a per cent in gains for the week.

But the real star of the week is Cyient DLM. It was incorporated in 1993 as Rangsons Electronics Pvt Ltd, and today, it's a leading player in the electronics system design and manufacturing sector. The company specializes in system design, integration, testing, and manufacturing of electronic components and subsystems, particularly for OEMs in the aerospace, defense, and other high-tech engineering segments. They're even involved in assembling printed circuit boards for the telecom and direct-to-home industries.

What makes Cyient DLM truly fascinating is its history. In February 2015, Cyient Ltd acquired 74 per cent stake in Cyient DLM from its former promoters, Mr. Pavan Ranga and his family, for a substantial sum of Rs 283 crore. Then, in January 2019, Cyient Ltd went all in and acquired the remaining 26 per cent stake for Rs 42.5 crore. Fast forward to June 2023, and Cyient DLM has carried out a fresh equity issuance, which resulted in Cyient's stake diluting to 67 per cent. But here's where things get intriguing. In the recent shareholding pattern, a notable name has emerged – Catamaran Ventures Llp.

Catamaran Ventures Llp, spearheaded by none other than the globally respected entrepreneur and founder of Infosys, Mr. Narayan Murthy, is a catalyst for creating innovation enterprises in India. They manage a staggering USD 1 billion across asset classes and focus their investments on listed companies with robust corporate governance, resilience across economic cycles, and, presumably, enormous growth potential. Catamaran Ventures Llp currently holds a 1.77 per cent stake in Cyient DLM, translating to 1,405,448 shares.

The story of Cyient DLM doesn't end there. This stock, which made its exchange debut in July, had an astounding start. It opened at Rs 403, significantly above its issue price of Rs 265 per share on NSE. Fast forward to the present, and the stock is trading at Rs 686.55, reflecting a whopping gain of 159 per cent from its issue price. In other words, it's a multibagger in the making.

And the financials are equally compelling. In Q1FY24, the Aerospace and Defence segments witnessed impressive YoY growth of 22 per cent and 12 per cent, respectively, aided by the Make in India initiatives and off-sets. The Industrial segment, not to be outdone, recorded an astonishing YoY growth of 75 per cent. The company's order backlog stands tall and stable at Rs 2,499.7 crore, a testament to their resilience. In fact, the company even reported some new wins in the aerospace and defence space, totaling around 2.7 crore. While the management has not provided specific revenue guidance, they've hinted that the company's revenue will likely surpass the industry average for the year. Furthermore, more than half of their order book is convertible in the next 12 months, signaling robust revenue visibility.

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