Synopsis: Tembo Global Industries has announced key corporate actions aimed at improving market participation and strengthening its capital structure, reflecting its focus on enhancing shareholder value and supporting future growth initiatives.
The shares of this small cap company majorly engaged in manufacturing and trading of fabricated metal products used in Pipe Support Systems, Fasteners, Anchors, HVAC were in focus after the management updates about the stock split
With the market capitalization of Rs. 1059 Crores, the shares of Tembo Global Industries Ltd were trading at around Rs. 571 per share which is 31 percent discount from its 52 week high of Rs. 837 per share and is trading at a P/E of 11.6 whereas industry P/E stands at 21.8
Stock Split to Enhance Liquidity
Tembo Global Industries has approved and recommended a 1:10 stock split, subject to shareholder approval. Under the proposal, each equity share with a face value of Rs. 10 will be split into 10 shares of Rs. 1 each. The company expects the move to improve share liquidity, make the stock more affordable, and increase retail investor participation.
Warrant Conversion Strengthens Capital Base
The Board also approved the conversion of 4,05,000 convertible warrants into 4,05,000 equity shares of Rs. 10 face value each on a preferential basis. Following the allotment, the company’s paid-up equity capital increased from Rs. 18.54 crore to Rs. 18.95 crore, while the new shares will rank pari-passu with existing shareholders.
Management Commentary
Management stated that the stock split is aimed at creating long-term shareholder value by improving market accessibility and trading activity. The warrant conversion reflects investor confidence in the company’s growth prospects and further strengthens its capital base for future expansion opportunities.
The stock split proposal requires shareholder approval at the upcoming EGM. The company will announce the record date for the split after obtaining the necessary approvals.
About the Company and Financials
Founded over 40 years ago, Tembo Global Industries Limited operates across four key business segments: Engineering Solutions & EPC, Defence Solutions, Solar Power, and Textiles. The company has built a strong global presence with exports to 30+ countries and currently has an order book of approximately Rs. 1,548 crore.
It is also planning a significant capacity expansion with a proposed 1,00,000 MTPA new manufacturing capacity. In terms of revenue mix, Engineering Products contribute 60 percent of revenue while Textiles account for 40 percent . Geographically, 88 percent of revenue comes from the domestic market, with 12 percent generated through exports.
Year on Year analysis: Revenue from operations has increased from Rs. 274 Crores to Rs. 346 Crores, up 26 percent. Operating profit has increased from Rs. 29 Crores to Rs. 39 Crores, up 34 percent and net profit has increased from Rs. 16 Crores to Rs. 30 Crores, up 87 percent.
Quarter on Quarter analysis: Revenue from operations has increased from Rs. 251 Crores to Rs. 346 Crores, up 37 percent. Operating profit has decreased from Rs. 43 Crores to Rs. 39 Crores, down 9 percent and net profit has increased from Rs. 26 Crores to Rs. 30 Crores, up 15 percent.
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