Multibagger penny stock at Rs 31 with Rs 1,400 crore order book: This engineering company reports stellar results and allotted 1,26,28,21,120 shares by way of bonus issue!

The stock gave multibagger returns of over 130 per cent year to date (YTD), 235 per cent in 1 year and a whopping 1,000 per cent in 5 years.

Today, the Indian stock market witnessed a surge, with the BSE Sensex and NSE Nifty indices surging by 0.16 per cent and 0.31 per cent respectively, accompanied by the remarkable ascent of a multibagger stock reaching a fresh 52-week high of Rs 30.92 per share, soaring 5 per cent to secure a spot among the day's leading gainers. This robust performance indicates a prevailing bullish sentiment in the market.

The stock name is SALASAR TECHNO ENGINEERING LTD (STEL).

The sudden rise in the stock price was due to the company announcing Quarterly Results (Q3FY24) and nine-month results (9MFY24) and allocated bonus shares. Here are the details:

According to quarterly results (Q3FY24), the net sales increased by 26.32 per cent to Rs 304.35 crore and net profit increased by 56.75 per cent to Rs 167.10 crore compared to Q3FY23 while in nine-month results (9MFY24), the net sales increased by 18.43 per cent to Rs 841.10 crore and net profit increased by 40.89 per cent to Rs 35.96 crore compared to 9MFY23.

Additionally, the Board of Directors at its meeting held on February 03, 2024, has approved the allotment of 1,26,28,21,120 equity shares of Rs 1 each by way of bonus issue to such members whose names have appeared in the Register of Members as of February 01, 2024, being the record date fixed for the said purpose, in the proportion of 4:1 i.e. 4 new fully paid-up equity share of Rs 1 each for every 1 existing fully paid-up Equity Share of Rs 1 each held by them.

Additionally, the company is set to raise a hefty Rs 806.4 crore to propel its growth and strengthen its financial standing. This will be achieved through a two-pronged approach: issuing up to 39 crore equity shares to non-promoters and 73 crore convertible warrants to both promoters and non-promoters, both at premium prices and subject to shareholder and regulatory approvals. To sweeten the deal for preferential allottees, they'll receive 4 bonus shares for each equity share and warrant, capitalizing on a pre-determined issue price and an upcoming bonus issue on February 1st, 2024.

Notably, specific investors like North Star Opportunities Fund, Intuitive Alpha Investment Fund, and Coeus Global Opportunities Fund have been earmarked for significant share allocations, underscoring the company's confidence in its fundraising strategy. This move is poised to inject substantial capital into the company, paving the way for its ambitious growth plans.

Salasar Techno Engineering Ltd (STEL), a prominent player in engineering and infrastructure solutions, has made a significant mark in the railway and power sectors, providing comprehensive EPC services with a strong track record of completed projects and a promising order book. Starting with contracts totalling around Rs 731.03 crore from esteemed power sector PSUs and Indian Railways, STEL has expanded its expertise, securing contracts worth Rs 2,516.43 crore in recent years, demonstrating continuous growth.

With a focus on innovation and customer satisfaction, STEL aims to contribute significantly to India's infrastructure development, highlighted by its successful bidding for contracts worth Rs. 979.37 crore under the RDSS. Its order book, categorized into competitive and regular business orders, stands at over Rs 1,400 crore in the railway and power sectors, supplemented by annual orders of approximately Rs 420 crore from trusted telecom sector clients.

The stock gave multibagger returns of over 130 per cent year to date (YTD), 235 per cent in 1 year and a whopping 1,000 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.