Can this penny stock see a Suzlon-like turnaround? Trades at a huge discount to book value – Watch out!

Karan Dsij
Can this penny stock see a Suzlon-like turnaround? Trades at a huge discount to book value – Watch out!

This momentum has carried through to October, as the stock posted a near 5 per cent gain despite turbulent market conditions, coupled with the highest trading volume recorded since its listing.

Dhanteras marks the auspicious beginning of Diwali, and while Indian benchmark indices have had a quiet start to this festive season, Bank Nifty is outperforming with gains of 0.17 per cent, rising above the 51,300 mark. Amid this subdued market, one penny stock stands resilient: KBC Global Ltd.

Recent Developments in KBC Global Ltd

Previously known as Karda Construction Ltd, KBC Global is a key player in the construction and real estate sector. The company recently made headlines by raising a significant Rs 99.50 crore through a preferential convertible warrant issue. This funding came from prominent investors like Patanjali Food and Herbal Park and Falcone Peak Fund (CEIC) Ltd, underscoring KBC’s growth potential.

In September, KBC Global experienced a remarkable rally, with shares surging by 22 per cent. This momentum has carried through to October, as the stock posted a near 5 per cent gain despite turbulent market conditions, coupled with the highest trading volume recorded since its listing.

Technical Indicators and Book Value

Interestingly, after touching a multi-month high, the stock encountered a pullback that stabilized around the critical 100-EMA support level, forming a strong bullish candle—a clear indication of solid technical support. Another compelling factor is that KBC Global’s book value stands at Rs 8.29, while its current market price is a mere Rs 2.16. This reflects a staggering 385 per cent discount to its book value, hinting at significant upside potential if market sentiment shifts.

International Expansion and Strategic Projects

Adding to its portfolio, KBC Global’s subsidiary in Ghana, KBC International Ltd, has signed a Memorandum of Understanding with the Liberia Special Economic Zone Authority. This agreement is to develop residential buildings, low-cost housing, and commercial spaces within a Special Economic Zone, with an estimated project cost of USD 12.5 million. The project is expected to commence in Q2 2025 and conclude within three years. This is KBC’s second major international venture, building its credibility on a global scale.

In June 2024, through its subsidiary Karda International Infrastructure Ltd, KBC secured a $20 million civil engineering subcontract from CRJE (East Africa) Ltd, affiliated with China Railway Construction Group. This contract represents KBC’s entry into Africa’s infrastructure space, further positioning it as an emerging player in regional development.

Domestic Expansion

KBC Global has also launched a new project in Deolali, Nashik, spanning 31,998 sq ft on Jai Bhavani Road. The development comprises six commercial and twenty-two residential units, underscoring the company’s growth in its home market.

Is a Turnaround in the Cards?

With substantial funding from reputable investors, international projects in Africa, and domestic expansion, KBC Global might be on the cusp of a significant turnaround. Much like Suzlon Energy's revival driven by sectoral tailwinds and debt restructuring, KBC Global's strong fundamentals could position it for similar growth.

Is this the next multibagger penny stock? Let us know your thoughts in the comments!

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

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