Shares of this undervalued stock under the ‘micro-cap’ category have proven to deliver multibagger returns of around 1,323 percent within a period of just two years.
Incorporated in 2007, Brand Concepts Limited is engaged in the business of manufacturing bags, backpacks & other fashion accessories for the Indian as well as International markets.
With a market capitalization of Rs 971 crores, the company’s shares closed at Rs 874 on Friday, a flat movement as compared to the previous close of Rs 872.95 apiece. The price-to-earnings (P/E) ratio of the company is reported at 79.79, way lesser than the industry P/E ratio of 103.54.
According to the data available from the Bombay Stock Exchange (BSE), the company’s stock has given multibagger returns of approximately 1,323 percent over a period of two years ranging from Rs 61.45 in January 2022 to the current stock price levels.
The same means that if someone had invested Rs 10,000 into the stock, it would have converted to around Rs 1.42 lakhs within the period mentioned above.
Mr Ashish Kacholia, one of the well-known ace investors based in India, bought a stake in the company in the December 2023 quarter. He bought approximately 1.60 lakh equity shares of the micro-cap company equating to a 1.44 percent stake.
The latest quarterly financial reports of the company portray an increase in the basic business parameters such as the operating revenue and net profits.
The operating revenue went up from Rs 58.06 crores during Q1FY23-24 to Rs 68.93 crores during Q2FY23-24, and, the net profits, keeping the timeframe the same, showed a change from Rs 3.12 crores to Rs 3.71 crores.
Additionally, the company reported healthy profitability ratios with the return on equity (RoE) increasing drastically from 3.45 percent during FY21-22 to 35.38 percent during FY22-23 and the return on capital employed (RoCE) increasing from 19.58 percent to 44.65 percent.
The debt-to-equity ratio of the company has reduced from a high level of 1.35 times during FY21-22 to the desired level of below 1, i.e., 0.92 times.
According to the shareholding data available for the December 2023 quarter represents the company’s Promoters holding a 48.82 percent stake followed by the retail investors holding a 48.71 percent stake in the company.
Written by Amit Madnani
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
