Narayana Murthy buys a stake in this small-cap multibagger automobile stock; do you hold it?

Shares of the company have gained over 40 per cent in the last six months.

Narayana Murthy is the co-founder of Infosys, one of India's largest IT companies. He is widely regarded as one of the pioneers of the Indian IT industry. Under Narayana Murthy's leadership, the company grew rapidly and became one of the world's leading IT services companies. 

Recently, Narayana Murthy’s Catamaran Ventures bought a stake in VST Tillers Tractors Limited. Catamaran Ventures, which was founded by Narayana Murthy, operates as a venture capital firm with assets of over USD 1 billion. 

V.S.T. Tillers Tractors Limited was promoted in 1967 as a 60:20:20 joint venture between V.T. Velu along with his two brothers in technical and financial collaboration with Mitsubishi, Japan (Mitsubishi Heavy Industries Limited and Mitsubishi Corporation), and Mysore State Industrial Investment Corporation Limited, for manufacturing power tillers and diesel engines. 

VST manufactures farm equipment, namely power tillers, tractors, power weeders, diesel engines and other precision agricultural and automotive components. It also trades in certain farm equipment (mainly rice transplanters), which are sourced from China. The company is headquartered in Bangalore, VST derives approximately 94 per cent of its revenues from the domestic market and has a nationwide network of more than 500 dealers to support sales and provide after-sales services. 

In the recent quarter, the company posted strong Quarterly Results. The revenue of the company for Q1FY24 stood at Rs 246.14 crore which grew by 4.31 per cent YoY. The operating profit of the company stood at Rs 49.83 crore, while the PAT of the company stood at Rs 32.99 crore, gaining by 228.26 per cent which was Rs 10.05 crore in last year's same quarter. The company is also a zero-debt company. 

The stock has also generated multibagger returns of over 100 per cent in the last three years. 

Investors should keep a close eye on this stock. 

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