This company supplies raw materials to steel companies and plans to expand its capacity by 60 per cent
Shares of the company skyrocketed by 6 per cent today.
Today, despite the sluggish market, shares of Raghav Productivity Enhancers Limited (RPEL) opened at Rs 645 and reached a high of Rs 689, an increase of 6 per cent. The 52-week high for the stock is at Rs 834.90, and the 52-week low is at Rs 434, while the value of the company on the stock market currently sits at Rs 731 crore.
RPEL produces quartz-based ramming material, quartz powder, and tundish board. Products are marketed and sold under the Raghav brand name. Among RPEL's most important clients are RL Steel, Mahalakshmi TMT, and Varsana SPA, to whom the firm provides ramming mass, silica ramming mixes, quartz, etc. In addition to India, the company operates in 26 other countries.
In FY22, the company's export sales accounted for 41 per cent of total revenues, up from 27 per cent in FY21. Nevai, Rajasthan is home to the factory. The current plant production capacity is up to 1,80,000 Mtpa in total. Raghav Productivity Solutions Private Limited, a wholly-owned subsidiary of the company located next to their current facility in the Tonk District of Rajasthan, would be used to increase the company's ramming mass production capacity by 108,000 TPA. The full amount of capital expenditures would be Rs 40 crore.
RPEL's high working capital needs can be traced back to its capital-intensive business model. The company's operations necessitate a sizeable stock of WIP and finished goods, as well as a generous credit policy. In Q2FY22, the company issued 6,000,000 preferentially assigned Unsecured Compulsory Convertible Debentures (CCDs) with a face value of Rs 515, for a total value of Rs 31 crore.
The company's sales for the past twelve months are Rs 114 crore. A compound annual growth rate of 21 per cent over the past three years seems attractive. The company's operating margin is 23.6 per cent, and its net profit margin is 17.7 per cent, both of which are healthy. In Q1 of FY23, sales were very strong. Sales increased by 61 per cent QOQ totalling Rs 33 crore. The operating cash flow for the company is positive. In FY22, the company's operations generated Rs 8 crore in cash.