Vijay Kedia-backed multibagger auto stock to keep under radar as the company invests Rs 82.72 crore in Khushbu Auto Finance Ltd
The stock is up by 38 per cent from its 52-week low of Rs 471 per share and gave multibagger returns of 250 per cent in just 2 years.
On Tuesday, one multibagger auto stock gained 1.83 per cent to Rs 650 per share from its previous close of Rs 638.30 per share.
The buzzing stock name is Atul Auto Ltd.
Atul Auto Limited has significantly increased its investment in its wholly-owned subsidiary, Khushbu Auto Finance Limited (KAFL), by subscribing to equity shares worth Rs 4.91 crore. This brings the total investment in KAFL to Rs 82.72 crore. KAFL is a non-banking finance company primarily engaged in financing three-wheelers and two-wheelers. As of March 31, 2024, KAFL had a paid-up share capital of Rs 57.67 crore, a turnover of Rs 42.79 crore, a net worth of Rs 109.69 crore and a profit after tax of Rs 237 lakh for FY 2023-24.
The investment in KAFL falls under related party transactions and does not involve any interest from promoters or group companies other than Atul Auto Limited. The transaction is considered at arm's length. KAFL's acquisition aligns with Atul Auto Limited's business strategy and strengthens its presence in the financing sector. The equity shares were allotted on September 28, 2024, and the total cost of acquisition was Rs 4.91 crore. This acquisition increases Atul Auto Limited's shareholding in KAFL to 100 per cent. KAFL has been operating since 1994 and has shown steady growth in its turnover over the past three years.
DSIJ’s 'Tiny Treasure' service recommends researched Small-Cap stocks with Inherent Growth Potential. If this interests you, do download the service details here.
Atul Auto Limited is an Indian three-wheeler manufacturing company based in Rajkot. Atul Auto manufactures and sells auto rickshaws in domestic and overseas markets. The company has a market cap of Rs 1,800 crore.
An ace investor, Vijay Kedia along with his company (Kedia Securities Pvt Ltd) owns a 20.91 per cent stake in the company. The stock is up by 38 per cent from its 52-week low of Rs 471 per share and gave multibagger returns of 250 per cent in just 2 years. Investors should keep an eye on this auto stock.
Disclaimer: The article is for informational purposes only and not investment advice.