Spectacular surge in this small-cap automotive components stock; hits new 52-week high!

The stock has exhibited impressive returns, surging by more than 29 per cent within a mere one-year span.

On Friday, Wheels India Limited has experienced a notable surge in its shares, soaring by an impressive 11.17 per cent. This remarkable ascent led the stock to attain an unprecedented pinnacle, reaching a fresh 52-week high of Rs 764.95 per share on the BSE platform. Additionally, the trading volume of the scrip witnessed an extraordinary escalation, surpassing its previous levels by an astounding 8.64 times.

Wheels India's recent developments have incited a significant amount of interest. Prashant Jain, a seasoned market expert who departed HDFC AMC nearly a year ago, is once again on the lookout for exceptional investment opportunities. In the month of May, his investment vehicle, 3P India Equity, procured 100,000 shares of Wheels India. Interestingly, the seller of these shares, Nippon India Mutual Fund, still retains ownership of over 1.6 million shares in the company, representing a 6.5 per cent stake. The average price for both transactions stands at Rs 551.0.

This purchase marks Jain's initial foray into the market since the launch of his Cat-III alternative investment vehicle. Renowned for his patient and value-oriented approach, Jain's primary interest lies in achieving long-term compounding gains.

Examining the financial performance of Wheels India, we find the following details:

• According to the quarterly figures, the net revenue experienced a growth of 6.17 per cent in Q4FY23 compared to Q4FY22, amounting to Rs 1,169 crore. During Q4FY23, the company generated a net profit of Rs 25 crore, leading to an earnings per share (EPS) of Rs 10.32.

• Analyzing the annual reports, the company's operating profit for the year amounted to Rs 220 crore, indicating a decline of 12 per cent compared to the previous year. Furthermore, the net profit for FY23 amounted to Rs 65 crore, experiencing a decrease of 18.75 per cent from FY22.

In the quarter ending in March 2023, the promoters of Wheels India enhanced their holdings from 58.10 per cent to 58.73 per cent.

Wheels India specializes in the production of road wheels, machinery and equipment components, and accessories used in the construction and mining sectors, along with parts for wind turbines. Remarkably, the stock has exhibited impressive returns, surging by more than 29 per cent within a mere one-year span.

Considering these factors, investors should a keep close eye Small-Cap on this automotive components and equipment stock.