Rs 846.9 crore order book: Power products company incorporated a subsidiary for power, machinery, & electronics, industrial equipment & spare parts and metal & component trading
The stock gave multibagger returns of over 100 per cent from its 52-week low and a whopping 600 per cent in 3 years.
Hind Rectifiers Limited announced the incorporation of a new wholly-owned subsidiary, Hirect FZ-LLC, on November 21, 2024, in the Ras Al Khaimah Economic Zone (RAKEZ) of the United Arab Emirates. With a paid-up capital of AED 125,000, Hirect FZ-LLC is poised to capitalize on the growing opportunities in the international market.
The incorporation of Hirect FZ-LLC does not constitute a related party transaction. While Mr. Suramya Nevatia, the Chairman and Managing Director of Hind Rectifiers Limited, has been appointed as a Manager and Director of Hirect FZ-LLC, the initial subscription by the Company is an arms-length transaction. The new subsidiary is strategically positioned to expand the Company’s global footprint and explore new avenues in power generation, transmission, and distribution equipment trading, as well as heavy equipment and machinery spare parts trading.
About the Company
Hind Rectifiers Ltd, established in 1958, is a leading manufacturer of power semiconductors, power electronics and railway transportation equipment. Their product portfolio includes traction and auxiliary transformers, IGBT propulsion systems, auxiliary converters, battery chargers, on-board DC rectifiers, traction motors, electrical switchboards, safety and protection electronics, rolling stock HVAC systems, electrostatic precipitators, high current rectifiers, power quality improvement equipment and special rectifiers.
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With a strong brand and market leadership, the company has been consistently improving its margins and expanding its product offerings to meet the growing demands of the Indian railways and industrial sectors. As of September 2024, the company boasts an impressive order book of Rs 846.9 crore, primarily driven by its strong pipeline of railway projects. The railway segment remains the company's core revenue driver, contributing approximately 95 per cent to the total revenue.
In the second quarter of the fiscal year 2025 (Q2FY25) was strong, with revenue surging 25.7 per cent year-over-year (YoY) to Rs 166 crore from Rs 132 crore in the same period last year. Profit after tax (PAT) also saw a significant increase of 156.1 per cent YoY to Rs 10 crore from Rs 4 crore. For the first half of the fiscal year (H1FY25), the company continued its positive momentum with revenue growth of 31.5 per cent YoY to Rs 302 crore and a remarkable 191.3 per cent YoY jump in PAT to Rs 17 crore. This strong performance was primarily driven by financial leverage and a lower effective tax rate. The return on equity (ROE) for the period stood at a robust 24.53 per cent (annualized), compared to 10.59 per cent in the previous fiscal year.
The company has a market cap of Rs 1,948 crore and on Friday, shares of Hind Rectifiers Ltd gained 1.62 per cent to Rs 1,136.65 per share from its previous closing of Rs 1,118.50 per share. An ace investor, Mukul Agrawal owns a 1.39 per cent stake in the company. The stock gave multibagger returns of over 100 per cent from its 52-week low and a whopping 600 per cent in 3 years.
Investors should keep an eye on this small-cap stock.
Disclaimer: The article is for informational purposes only and not investment advice.