Rs 112,50,00,000 Buyback Announced at 30 Per Cent Premium: Rahul Gandhi’s Portfolio Automotive Cable & Halogen Bulb Maker's Stock to Keep Under The Radar

The stock is up by 52.5 per cent from its 52-week low of Rs 353.25 per share.

On Wednesday, at the closing bell, shares of this automotive cable and halogen bulb maker's stock were trading at Rs 538.75 per share, up 3.11 per cent with an intraday high of Rs 543.95 and an intraday low of Rs 520.14 from its previous closing of Rs 522.50.

The stock name is Suprajit Engineering Ltd. 

Suprajit Engineering, founded in 1985 by Ajith Kumar Rai, is a leading automotive component manufacturer primarily focused on mechanical control cables, holding a dominant market share of approximately 65 per cent in the domestic two-wheeler and passenger vehicle segment. The company has expanded its product portfolio to include halogen lamps, catering to various automotive lighting needs. Beyond the original equipment market, Suprajit also has a growing presence in the aftermarket and export markets.

The Board has declared a buyback of equity shares. The last buyback was in March 2021. Subject to necessary clearances, the company will buy back 15,00,000 equity shares at a price of Rs 750 amounting to Rs 112.50 crore from all eligible shareholders on the record date that will be announced at a 30 per cent premium of the current market price. This buyback is expected to be completed before September 30, 2024.

Suprajit Controls Division (SCD) demonstrated resilience in a weak global market. Operational revenue climbed 3.3 per cent while EBITDA surged 16.4 per cent, crossing the crucial 8 per cent margin threshold. The automotive division continued its winning streak despite industry stagnation, securing substantial new orders. SCD expanded its reach beyond automotive, acquiring new non-automotive contracts. While SCD China thrived with new business and a successful new plant, European operations faced challenges due to geopolitical issues. North American units improved margins through restructuring but struggled in the non-automotive sector. India's automotive exports excelled, securing high-margin contracts, but the non-automotive segment remained stagnant. The Domestic Cable Division delivered satisfactory results, though margins dipped slightly due to increased costs.

Phoenix Lamps Division (PLD) significantly enhanced profitability despite flat revenue. Operational improvements in India and Luxlite boosted margins. Luxlite's restructuring proved successful, driving sales growth and margin expansion for the Trifa brand. Suprajit Electronics Division (SED) achieved robust growth and EBITDA margins, though EV segment performance fell short of projections. The division secured new business in electronic throttle and sensors from key customers. Suprajit Technology Centre (STC) fortified its team to support multiple new projects across the company. Strategically, Suprajit acquired Stahlschmidt Group Companies (SCS), a renowned Light Duty Cable maker, expanding its manufacturing footprint to Morocco and China. The company continues its search for additional industrial properties to support long-term growth plans.

As of the election affidavit ended March 31, 2024, Congress Leader & Member of Parliament – Rahul Gandhi owns 4,068 shares of the company aggregating to Rs 21,91,635 (as of Wednesday, August 14, 2024 closing price of Rs 538.75 per share). The company has a market cap of Rs 7,460 crore and reported positive numbers in its Quarterly Results (Q1FY25) and annual results (FY24). The stock is up by 52.5 per cent from its 52-week low of Rs 353.25 per share.Investors should keep an eye on this small-cap stock.

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

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