Rs 50,00,00,000: Multibagger Penny Stock Under Rs 70 To Keep Under Radar As The Company Approved Setting Up Of A Forward Integration Project
From Rs 20.35 (52-week low) to Rs 65.40 per share, the stock gave multibagger returns of 221 per cent in just 1 year and a whopping 3,000 per cent in 5 years.
Today, shares of Rathi Steel and Power Ltd gained 4.84 per cent to Rs 65.40 per share from its previous closing of Rs 62.38. The stock’s 52-week high is Rs 97.81 while its 52-week low is Rs 20.35.
The Board of Directors has approved the establishment of a forward integration project involving the production of stainless steel wires, bright bars, annealed, and pickled products, with a total project cost of up to Rs 50 crore. This project will not only optimize the utilization of existing capacity by facilitating self-consumption but will also allow the Company to meet the increasing demand for these products and their allied products in sectors such as Energy, EV, Engineering, and Defense. The project will be set up on surplus land at the Company's existing facilities in Ghaziabad, Uttar Pradesh, leading to optimized logistics and overhead costs. The Company will initiate the necessary steps to obtain the required approvals and implement the project in phases based on technical and commercial feasibility.
Established in 1971, Rathi Steel and Power Ltd, a Delhi-based steel manufacturer, offers Rebars and Wire Rods under the "RATHI" brand across 1,000 retail outlets and also supplies stainless steel products to major producers of downstream goods like Bright Bars and fasteners. Their clientele boasts esteemed names like the Airports Authority of India, Delhi Metro Rail, and NTPC. The company has a market cap of over Rs 550 crore.
Rathi Steel and Power Limited reported a total revenue of Rs 127.73 crore in Q1FY24, a 12.83 per cent decline YoY but a 7.95 per cent increase QoQ. Despite this, EBITDA surged to Rs 5.97 crore and PAT reached Rs 2.69 crore, representing a 50 per cent and 800 per cent increase YoY and QoQ, respectively. Factors contributing to this include cost-reduction initiatives, a modernisation project and a pioneering cost optimisation project. The company achieved debt-free status, established new banking relationships, and increased its reliance on green power. In FY24, the company reported net sales of Rs 492.83 crore and a net profit of Rs 23.61 crore, overcoming economic downturn, raw material shortages and intense competition.
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In June 2024, FIIs bought 76,15,502 shares or 8.95 per cent stake in the company. The promoters of the company own a 40.32 per cent stake, FIIs own 8.95 per cent, DIIs own 2.89 per cent and the public owns a 47.85 per cent stake as of June 2024. From Rs 20.35 (52-week low) to Rs 65.40 per share, the stock gave multibagger returns of 221 per cent in just 1 year and a whopping 3,000 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.