Multibagger Penny Stock Under Rs 20 To Keep Under Radar As Company Rolled Out Bonus Shares With Plans Of Capital Expansion & Carbon Credit Project
The stock gave multibagger returns of 525 per cent in just 3 years and a whopping 815 per cent in 5 years.
On Monday, shares of Axita Cotton Ltd gained 0.60 per cent to Rs 15.38 per share from its previous closing of 15.29. The stock’s 52-week high is Rs 26.54 and its 52-week low is Rs 14.54 per share.
In a move signalling a significant stride in its corporate strategy, Axita Cotton Limited, a leading name in the production of cotton bales and cotton seeds, has officially allotted bonus Equity Shares to its eligible shareholders. The decision, approved by the Company's Board of Directors in a landmark meeting on August 09, 2024, marks a noteworthy milestone for the organization
Under the Bonus Issue scheme, shareholders have been granted one Bonus Share for every three shares held, a move that underscores the company's commitment to rewarding its loyal supporters. The record date for determining shareholder eligibility was set as September 20, 2024. In line with the stipulations of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the issuance of Bonus Equity Shares in the 1:3 ratio was recommended by the Board and subsequently approved by shareholders via the postal ballot
Post the Bonus Issue, the Company's paid-up Equity Share Capital has surged from Rs 26.08 crore to Rs 34.77 crore, with the total Equity Shares increasing from 26.08 crore to 34.77 crore. Axita Cotton has designated Rs 8.69 crore from its free reserves to facilitate the Bonus Issue
In addition to this significant development, Axita Cotton is thrilled to announce the successful registration of its maiden carbon credit “Pilot Project” under the voluntary carbon market, marking a momentous stride towards sustainable and regenerative agriculture. This pioneering initiative, integrating various ICS performing practices, is set to yield an estimated 200,000 carbon credits, projected to be valued at approximately Rs 4.98 crore in the dynamic voluntary market.
The project will undergo meticulous auditing under ISO 14065 by an esteemed independent third-party Verification and Validation Body, with the carbon credits to be issued in adherence to renowned voluntary carbon market standards. Looking to the horizon, Axita Cotton aims to introduce an additional Eleven carbon credit projects, to generate approximately 2.2 million credits over the next seven years. Anticipating a rise in carbon credit prices due to the burgeoning carbon market, these projects are estimated to achieve a market value of approximately Rs 55 crore.
Employing the most advanced methodologies, including GIS, Environmental Simulation Modelling, and DMRV systems (Digital Monitoring, Reporting, and Verification), in the development of this carbon credit pilot project, Axita Cotton endeavours to significantly benefit local farmer groups. In alignment with five of the United Nations' Sustainable Development Goals, this initiative will provide financial incentives to local farmers through the revenue generated from these carbon credits.
In a step towards addressing the urgency of climate action, the Company is also pioneering the adoption of Direct Air Capture (DAC) technology to generate real carbon removals under the Carbon Capture Utilization and Storage (CCUS) scope. This strategic move is aligned with Axita Cotton’s commitment to achieving CO2 neutrality goals in the coming years, further underscoring its dedication to environmental stewardship and corporate social responsibility.
DSIJ's ‘Penny Pick’ service provides research-backed penny stock recommendations below Rs. 100. If this interests you, do download the service details here.
About the Company
Axita Cotton Limited is engaged in the business of manufacturing, processing and finishing cotton bales and cotton seeds. The company's main business is the ginning and pressing of seed cotton (Kapas) on a work basis and the production of cotton bales and cotton seeds. The company has a market cap of Rs 530 crore.
According to the Quarterly Results, the net sales decreased by 32 per cent to Rs 154.93 crore and the net profit decreased by 38.3 per cent to Rs 3.55 crore in Q1FY25 compared to Q1FY24.In its annual results, the net sales increased by 101.1 per cent to Rs 1,102 crore and net profit increased by 19.4 per cent to Rs 20.33 crore in FY24 over FY23.
The stock has an ROE of 35 per cent and an ROCE of 38 per cent. The stock gave multibagger returns of 525 per cent in just 3 years and a whopping 815 per cent in 5 years. Investors should keep an eye on this micro-cap stock.
Disclaimer: The article is for informational purposes only and not investment advice.