Penny Stock Below Rs 35 in Focus as Company Announces Stellar Results, Plans To Raise Rs 5,000 Lakh via Rights Issue, and Announces Business Expansion

The stock is up by 55.7 per cent from its 52-week low of Rs 17.72 per share and gave multibagger returns of over 3,100 per cent in 5 years.

On Wednesday, shares of SBC Exports Ltd plunged 3.93 per cent from their previous closing of Rs 28.72 per share to Rs 27.59 per share with an intraday high of Rs 30.71 and an intraday low of Rs 27.11. The shares of the company saw a spurt in volume by more than 1.70 times on BSE.

According to Quarterly Results, the net sales increased by 87.34 per cent to Rs 65.98 crore and net profit increased by 147.31 per cent to Rs 5.37 crore in Q2FY25 over Q2FY24. In its half-yearly results, the net sales increased by 3.34 per cent to Rs 121.32 crore and net profit increased by 15.62 per cent to Rs 6.18 crore in H1FY25 over H1FY24

Furthermore, the shares of the company ex-traded bonus shares in the ratio 1:2 i.e., 1 equity share for every 2 equity shares held by the existing equity shareholder of the company. The ex-record date was January 19, 2024. Pre-Bonus Issue Paid-up Share Capital – 21,16,40,000 Post Bonus Issue Paid-up Share Capital – 31,74,60,000.

SBC, founded in 2011 as a handicraft trader, has evolved into a diversified company with three primary business verticals: garments, IT services and travel. The company's garment division has grown significantly, with four manufacturing units and plans for further expansion. SBC's IT services division provides support to various organizations and its travel subsidiary, Mauji Trip Limited, is experiencing rapid growth. The company's focus on branding, product development and profitability has positioned it for continued success in the coming quarters. With a strong financial performance and a commitment to shareholder value, SBC is poised to emerge as a stronger and more competitive player in the market.

Expansion: SBC is now pursuing an increase in the capacity of its Garment Division by setting up an ultra-modern garments unit at Ghaziabad for which it has already acquired land measuring 3502.38 sq. mtrs. The new facility will be largely catering to the international market where SBC is getting large inquiries but has capacity constraints currently. The new facility will have a State-of-the-art stitching, printing & packaging unit besides having a world-class display centre, warehousing and administrative area. SBC is already in the planning stage of project implementation and will be implementing the project in a phased manner and will execute the entire project in the next 18 months.

Fundraising: SBC is also proposing to raise up to Rs 5000 lakh by way of issuance of equity shares on a Rights basis to its existing shareholders for which the resolution has been passed in the Board Meeting as an agenda item. The funds will be utilized to part finance the expansion project, incremental working capital requirement and other corporate purposes.

SBC Exports Ltd was incorporated in 2011 with a market cap of Rs 876 crore. In FY24, the net sales increased by 7 per cent to Rs 209.41 crore and net profit increased by 36.71 per cent to Rs 9.44 crore over FY23. The stock is up by 55.7 per cent from its 52-week low of Rs 17.72 per share and gave multibagger returns of over 3,100 per cent in 5 years. 

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