Multibagger penny stock at Rs 2.03; Board announces rights issue worth Rs 49,00,00,000; details inside!

The stock gave multibagger returns of over 100 per cent returns from its 52-week low of Re 1 per share.

Srestha Finvest Ltd announced the details of their upcoming rights issue. The company will issue 24 crore new equity shares of Rs. 2 each, raising a total of Rs. 48 crore. The rights issue will be offered to existing shareholders on a record date of Friday, June 21, 2024.

Eligible shareholders will receive rights entitlements in their demat accounts which can be used to purchase new shares. The ratio is 12 rights shares for every 29 equity shares held. This means that for every 29 shares a shareholder owns on the record date, they will receive the rights to buy 12 new shares. The issue price is Rs. 2 per share, which is the face value of the share. Shareholders will have to pay the entire amount of Rs. 2 per share on application. The rights issue will open on Thursday, July 4, 2024, and close on Thursday, July 18, 2024. Shareholders can renounce their rights entitlements through the market until July 12, 2024. If the entire issue is subscribed, the outstanding equity shares of the company will increase from 58 crore to 82 crore.

Earlier, the company partnered with Felix Industries Limited, to drive renewable energy and sustainability efforts in India. This June 13, 2024, Facility Agreement allows Srestha Finvest to enter the loan market for clean water access, water recycling, and renewable energy projects. By combining expertise and resources, both companies aim for significant environmental impact. Srestha Finvest will commit Rs 25 crore over one to two years to fund Felix Industries' renewable energy and clean water projects, while also strategically expanding into new technology sectors. The agreement targets clean water, waste-to-energy solutions, recycling initiatives, green infrastructure development, e-waste management, and waste-to-oil projects. Importantly, this collaboration is an arms-length transaction, meaning fair market value is used and there are no familial or business ties between the companies' promoters.

Today, shares of Srestha Finvest Ltd jumped 3.55 per cent to Rs 2.04 per share from its previous closing of Rs 1.97. The stock’s 52-week high is Rs 2.17 while its 52-week low is Rs 1.

Established in 1985, Srestha Finvest Ltd. is a multifaceted financial services company offering various solutions, including loans, financing, and investments. They hold a specific regulatory license: a Category B Non-Systematically Important Non-Deposit Taking NBFC - Investment and Credit Company. This allows them to provide loans secured by various assets (securities, movable and immovable properties), offer hire purchase and leasing options, and engage in trading and investing shares.

Quarterly Results

The total increased by 710 per cent to Rs 564.16 lakh in Q4FY24 compared to the total income of Rs 69.68 lakh in Q4FY23. The company reported a net profit of Rs 506.35 in Q4FY24 compared to a net loss of Rs 461.37 crore in Q4FY23, an increase of 210 per cent.

Annual Results

The total increased by 269 per cent to Rs 1,013.01 lakh in FY24 compared to the total income of Rs 274.56 lakh in FY23. The company reported a net profit of Rs 173.86 in FY24 compared to a net loss of Rs 497.41 crore in FY23, an increase of 135 per cent. The company reported a net profit in FY24 after reporting a net loss for the past 5 years i.e., FY23, FY22, FY21, FY20 and FY19.

The company has a market cap of over Rs 100 crore and its 100 per cent stake is owned by the public. The stock gave multibagger returns of over 100 per cent returns from its 52-week low of Re 1 per share. Investors should keep an eye on this micro-cap stock.

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