Companies with a ‘fundamentally strong’ nature portray various characteristics including low debt-to-equity levels, strong financials, etc.
Herein this article, we will have a glance at one such fundamentally strong stock in the gas distribution business.
Refex Industries
Refex Industries Limited is engaged in the process of manufacturing as well as refilling refrigerant gases. The company generates a majority of its revenues from the ‘Ash Handling’ and ‘Coal’ segments. It conducts business activities throughout the Indian regions.
The company’s shares are currently trading today at Rs 530, slipping around 0.90 percent compared to the previous closing levels of Rs 534.20. It has a market capitalization of approximately Rs 1,200 crores.
In the past year, the company’s stock has delivered multibagger returns of 374 percent ranging from Rs 112 in July last year to the current price levels. Moreover, in a shorter timeframe of three months, the stock delivered drastic returns of 134 percent taking the stock price up from Rs 226 to the current levels.
Coming onto the consolidated financials of the company have shown decent growth as far as the operating revenues and net profits are concerned. The operating revenues increased from Rs 632 crores during FY20-21 to Rs 1,629 crores in FY22-23 and, the net profit numbers, went up from Rs 40 crores to Rs 116 crores representing an increase of around 190 percent.
Moreover, the profitability ratios improved with the return on equity (RoE) moving from 29.33 percent during FY20-21 to 36.91 percent in FY22-23 and the return on capital employed (RoCE) taking a shift from 31.47 percent to 41.88 percent during the same period.
In addition to the above ratios, another looked-upon metric is the return on asset (RoA) which showed a movement from 11.99 percent to 15.42 percent. The debt-to-equity ratio, though increased compared to the previous financial year, has stayed within the desired limits and was reported at 0.26 times during FY22-23.
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.
