12,000 Per Cent Returns: Multibagger Transformers & Solar Power Stock Hit Upper Circuit As Company Reports 46,959.3 Per Cent Jump In PAT

The stock gave multibagger returns of 4,000 per cent in just 1 year and a whopping 12,000 per cent in 5 years.

Marsons Limited, a seasoned player in the power and distribution transformer industry, boasts over six decades of expertise. Their comprehensive capabilities span the entire value chain, from meticulous design and manufacturing to reliable supply, rigorous testing, and seamless commissioning of power transformers. As a multifaceted organization, they offer a diverse range of products, including Distribution & Power Transformers (10 KVA to 160 MVA, 220 kV class), Furnace Transformers, Dry Type Transformers, and specialized application transformers. Their advanced manufacturing unit in Kolkata, sprawling across 35,000 sq.m, is equipped with cutting-edge infrastructure to produce EHV (Extra High Voltage) transformers up to 220 kV class. This facility, housing an in-house Impulse Testing Laboratory and Autoclave system, sets industry standards for quality and reliability.

According to Quarterly Results, the net sales increased by 2,000 per cent to Rs 4,031.90 lakh and net profit increased by 1,550 per cent to Rs 746.98 lakh in Q2FY25 compared to Q2FY24. In its half-yearly results, the net sales increased by 3,160 per cent to Rs 7,055.80 lakh and net profit increased by 47,143 per cent to Rs 1,270.82 lakh in H1FY25 compared to H1FY24. In its annual results (FY24), the company reported net sales of Rs 662.22 lakh and net profit of Rs 62.85 lakh.

The company has embarked on a strategic initiative to diversify its product portfolio and expand into new market segments. A key milestone in this strategy is the successful acquisition of the first developmental order for traction transformers from Benaras Locomotive Works, marking a significant entry into the high-potential Indian Railways segment. This move aligns perfectly with the government's ambitious railway and metro expansion plans, offering substantial growth opportunities.

Simultaneously, the company is actively focusing on the renewable energy sector by introducing Inverter Duty Transformers and Generator Step-Up Transformers. These products are crucial components of solar and wind power plants, and their demand is expected to surge as India strives to achieve its renewable energy target of 500 GW by 2030. This segment is projected to contribute a substantial portion of the company's revenue in the coming years.

To support this growth trajectory, the company plans to double its manufacturing capacity to 9,000 MVA by FY27. This expansion will be executed in a capital-efficient manner by leveraging existing infrastructure and land bank. The company's strategic focus areas include strengthening its domestic presence, expanding into global markets, and driving innovation and technology adoption. By focusing on these key areas, the company aims to capitalize on the growing demand for its products both domestically and internationally.

Several factors are driving the company's growth. The expanding Indian transformer market, fuelled by grid expansions, renewable energy integration, and government initiatives, presents significant opportunities. The rising demand for specialized transformers in the renewable energy sector, coupled with the booming export markets, further strengthens the company's growth prospects. Additionally, the strategic focus on data centres, a rapidly growing segment, offers a compelling growth avenue. The company's outlook is positive, with a focus on capacity utilization, expansion into the EHV transformer segment, and leveraging EPC projects and synergistic opportunities in renewable energy and infrastructure.

Earlier, the company received a Letter of Intent from NACOF OORJA to develop a 150 MW (AC) Grid-Interactive Ground-Mounted Solar PV Power Generation Plant. This project, executed under the KUSUM Scheme for RRECL, aims to provide daytime power to agricultural consumers in Rajasthan. We will collaborate technically with Aditya Clean Systems (P) Ltd. The project is valued at approximately Rs 675 crore (inclusive of taxes) and has an execution timeline of 12-18 months. NACOF OORJA will award multiple contracts for individual units, with each contract valued at approximately Rs 4.50 crore per MW (AC). The contracts are domestic and require adherence to quality standards and agreed timelines. NACOF OORJA reserves the right to cancel contracts if performance is unsatisfactory.

Marsons Ltd has a market cap of over Rs 4,000 crore and has a 3-year stock price CAGR of 200 per cent. The stock gave multibagger returns of 4,000 per cent in just 1 year and a whopping 12,000 per cent in 5 years. Investors should keep an eye on this small-cap stock.

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