Shares of Carborundum Universal Limited closed at a price of Rs 1,209 on friday and has a market capitalization of Rs 22,810 crores.
The scrip has given multibagger returns of approximately 17,758 percent during a long-term period of 20 years ranging from Rs 6.77 in May 2003 to the current price levels. It means that if someone would have invested Rs 1,00,000 into the stock, it would have converted to around Rs 1.78 crores within a period of 20 years. The stock reached its all-time high level of Rs 1,224 on the 19th of May, 2023.
Carborundum Universal Limited is an investment holding company with operating segments including Abrasives, Super Refractories, Ceramics, and Electrominerals. The company generates a majority of its revenue from the ‘Abrasives’ segment. Geographically, it derives most revenue from domestic operations within India itself.
Digging into the quarterly numbers reported by the company, the operating revenues increased from Rs 1,187 crores in the December 2022 quarter to Rs 1,200 crores in the quarter ending March 2023. Moreover, the net profit numbers increased taking a shift from Rs 113 crores to Rs 149 crores showing an increase of around 32 percent.
On a YoY basis, both the above-mentioned metrics have been successful in showing an upward movement with operating revenues increasing from Rs 3,325 crores during FY21-22 to Rs 4,654 crores in FY22-23 and net profits going up from Rs 350 crores to Rs 442 crores keeping the horizon the same.
In addition to the above, the company has seen some improvements as far as the profitability ratios are concerned. The return on equity (ROE) rose from 14.10 percent during FY21-22 to 14.67 percent in FY22-23. On a contrasting note, the return on capital employed (ROCE) decreased from 18.11 percent to 16.98 percent.
The debt-to-equity ratio of the company marginally went down from 0.09 times in FY21-22 to 0.08 times in FY22-23.
The latest shareholding data represents that the promoters hold a 41.52 percent stake, and Foreign Institutional Investors (FIIs) hold a 9.36 percent stake in the company.
Written by Amit Madnani
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