Promoter increasing stake: Multibagger penny sugar stock journey from Rs 3.5 to Rs 26 in just a year; investment of Rs 1 lakh turned to Rs 7.42 lakh, do you hold it?

The question now is, do you hold this potential gem in your investment portfolio?

In the vast and tumultuous ocean of the market, it's all too easy to get swept up in the tide of consensus trades. It's a reassuring feeling, isn't it? To know that even if your investment goes south, you can always tell yourself that you weren't alone in making that choice. It was a "consensus trade," after all. But here's the rub: there's always a hidden story behind those stock prices that refuse to ascend. Something, somewhere, has gone amiss, leading to an absence of appreciation. In the world of stocks, however, there exists a cadre of individuals who dare to chart a different course, who seek out opportunities that don't bask in the limelight. These are the hidden gems, the uncut diamonds of the market.

Today, we shine a light on one such hidden gem, an underdog in the world of stocks. This micro-cap stock, with a market cap of just Rs 153 crore, has embarked on a remarkable journey. A year ago, in October, it traded at a humble Rs 3.53 per share, but on October 20, 2023, it soared to Rs 26.15. What's more, it was locked at the upper circuit on a recent Friday, indicating an undeniable surge in investor interest. The numbers speak for themselves – a breathtaking, awe-inspiring return of 640 per cent, as a result, the stock turned out to be multibagger! Let that sink in for a moment: an investment of Rs 1,00,000 in this stock would have bloomed into a staggering Rs 7,42,000 in just one short year.

This remarkable hidden gem is none other than Gayatri Sugars Ltd (GSL), a company deeply rooted in Hyderabad. Established in 1995, GSL is proudly promoted by the visionary triumvirate of Ms. Indira Subbarami Reddy, Mr. Sandeep Reddy, and Ms. Sarita Reddy. The company specializes in the production of white crystal sugar and rectified spirit/extra neutral alcohol. Its sugarcane crushing capacity stands at a robust 7,000 tonnes per day, while its distillery and co-generation units boast capacities of 45 kiloliters per day and 25 megawatts, respectively.

However, what truly piques one's curiosity is the recent revelation that the promoters of GSL have increased their stake in the company from 54.63 per cent to an impressive 59.59 per cent by the end of September 2023. This level of confidence from the company's own leadership is a testament to their belief in GSL's growth potential.

In a recent development, GSL announced that BSE Limited has granted trading approval for 38,33,333 equity shares of Rs. 10 each, issued to non-promoters on a preferential basis following the conversion of warrants. Furthermore, an additional 1,10,00,000 equity shares of Rs. 10 each were issued to the promoters on a preferential basis.

The company's dedication to progress is evident in its financial performance over the last two fiscal years. In fiscal year 2023, GSL reported a revenue of Rs 388 crore, coupled with an impressive operating margin of 10.4 per cent. With an emphasis on better recovery and operating efficiency, there is no doubt that GSL is on track to achieve even greater business performance in fiscal year 2024.

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