32,750 per cent returns: Multibagger stock hit back-to-back 52-week highs as this small-cap - Eraaya Lifespaces acquires Nasdaq-listed Ebix Inc
Over the past year, the stock has delivered multibagger returns of over 7,300 per cent and over five years, it has surged by an astonishing 32,750 per cent.
On Friday, shares of Eraaya Lifespaces Limited gained 4.15 per cent to Rs 2,490 per share from the previous day's close of Rs 2,390.65. The stock also made a new 52-week high is Rs 2,490 per share and its 52-week low is Rs 33.56 per share. In recent trading sessions, the stock has consistently reached new 52-week highs. Over the past year, the stock has delivered multibagger returns of over 7,300 per cent and over five years, it has surged by an astonishing 32,750 per cent.
Eraaya Lifespaces: A Rapidly Growing Entity
The company is in the hospitality sector and has limited physical assets consisting of three bungalows located in Goa, Naukuchiatal, and Lonavala. The company has a market cap of over Rs 4,500 crore with a 3-year stock price CAGR of 520 per cent with debt-free status. According to Quarterly Results, the company reported net sales of Rs 2 crore in Q1FY25 and net profit increased by 1,887.5 per cent to Rs 0.95 crore in Q1FY25 compared to a net profit of Rs 0.05 crore in Q1FY24. In its annual results, the net sales increased by 1,52,311 per cent to Rs 297.20 crore and net profit increased by 341.6 per cent to Rs 0.34 crore in FY24 over FY23.
The Game-Changing Acquisition of Ebix Inc.
In December 2023, Eraaya Lifespaces acquired Nasdaq-listed Ebix Inc., a global e-commerce, cloud computing, insurance, finance, healthcare, and e-learning company. This acquisition marked a significant step in Eraaya’s international expansion. Ebix Inc.’s Indian subsidiary, EbixCash, operates in money remittance, foreign exchange and travel services. Despite Ebix Inc.’s Chapter 11 bankruptcy filing, its robust asset base, particularly through EbixCash, adds value to Eraaya’s portfolio. Eraaya successfully raised over Rs 1,200 crore for this acquisition, demonstrating financial prudence and strength. This amount exceeded its market capitalization at the time, reflecting its solid financial standing and investor confidence. With this significant financial commitment, Eraaya has positioned itself as a leader in the global business environment.
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Financial Resilience and Growth
Eraaya Lifespaces has demonstrated a strong ability to secure funds for its ambitious growth plans. The company raised Rs 248 crore through a Qualified Institutional Placement (QIP) in August 2024 and further announced its intention to raise Rs 500 crore via Foreign Currency Convertible Bonds (FCCBs). In early September 2024, it successfully raised Rs 1,028 crore through a preferential allotment. The total funds raised have been effectively utilized to complete the acquisition of Ebix Inc., with Eraaya paying Rs 1,273.25 crore towards the acquisition. With the acquisition complete, Eraaya Lifespaces now holds an impressive 97.6 per cent stake in Ebix Inc.
A Diversified Business Portfolio
Eraaya Lifespaces is part of a larger group of companies that have been actively acquiring businesses across various sectors, including pubs, news channels, non-banking financial companies, and even movie production. This diverse portfolio provides a strong foundation for long-term growth and resilience. Eraaya’s acquisition strategy extends beyond hospitality and technology. Vikas Lifecare, a consortium partner in the Ebix deal, is a leader in waste recycling and high-end speciality chemicals. The company has acquired stakes in Dubai-based clubs and event management companies, which not only broadens its horizons but also brings in various revenue streams.
Strategic Real Estate Investments
One of the key characteristics of Vikas Garg's network of companies is their involvement in the real estate sector. Eraaya Lifespaces, along with its affiliated entities, has been actively engaged in real estate investments, particularly in the Delhi-NCR region. Vikas Lifecare has made significant progress in acquiring agricultural land while Vikas Ecotech and Advik Capital have also expressed a keen interest in the real estate sector. These real estate investments align with Eraaya Lifespaces' growth strategy, enabling it to diversify its asset base and explore new opportunities for revenue generation. By strategically investing in land and real estate projects, Eraaya and its partner companies are positioning themselves for long-term financial stability and growth.
A Bright Future Ahead
Eraaya Lifespaces has not only proven its ability to navigate through financial challenges but has also shown immense potential for future growth. Its acquisition of Ebix Inc. positions it at the centre of global tech and e-commerce, while its strong real estate portfolio provides a solid foundation for sustained growth. The company’s ability to raise significant capital, form powerful alliances and make strategic investments demonstrates that it is well-positioned to continue its upward trajectory in the coming years. Eraaya Lifespaces also continues to expand its reach, solidify its presence in key markets and explore new growth opportunities.
Disclaimer: The article is for informational purposes only and is not investment advice.