Shares of this multibagger real estate stock jumped up to 8 percent after the company received an order worth Rs 262.19 crores for the construction and maintenance of a Government Medical College in Chhattisgarh. In the past month, the company’s stock has gained nearly 35 percent.
With a market capitalization of Rs 1,640.53 crores, the stocks of Vascon Engineers Limited, a civil construction company, opened their trading hour on Monday at Rs 72 and currently trades at Rs 75.49.
The company’s scrip witnessed an intra-day high, also marked as the fresh 52-week high price, of Rs 78.45, indicating a gain of 8 percent as compared to the previous close of Rs 72.64 apiece.
Such sharp movements in the stock price were witnessed after the company, through a regulatory filing with the BSE dated 9th October 2023, intimated that the company received a letter of intent (LoI) from ‘Bridge & Roof Company (India) Limited’, a Government of India Enterprise worth Rs 262.19 crores.
The order pertains to the planning, designing, construction, and, maintenance of a Government Medical College in Chhattisgarh under the Chhattisgarh Medical Services Corporation Limited. The order has been undertaken on an ‘EPC’ basis, and, the same has to be completed within a period of 24 months from the date of commencement.
Keeping a purview of just six months, the company’s stock has proven to deliver multibagger returns of 180 percent, i.e., if someone had invested Rs 1 lakh in the stock six months back, it would have converted to Rs 2.80 lakhs.
Having a walkthrough of the consolidated financials reported, the company increased its operating revenues as well as after-tax profits with the former moving up from Rs 656.86 crores during FY21-22 to Rs 1,019.38 crores during FY22-23, and, the latter, taking a shift from Rs 35.92 crores to Rs 99.41 crores keeping the timeframe the same.
Due to the same, the basic profitability metrics of the company such as the return on equity (RoE) as well as the return on capital employed (RoCE). The RoE increased from 4.82 percent during FY21-22 to 11.67 percent during FY22-23, and, RoCE took a shift from 6.93 percent to 11.58 percent.
According to the most recent shareholding data available for the quarter ended June 2023, the company’s Promoters hold a 32.2 percent stake, and the Foreign Institutional Investors (FIIs) hold a 0.51 percent stake in the company.
Vascon Engineers Limited is a construction company that is associated with the process of developing as well as managing different engineering, procurement, and construction (EPC), real estate development, and manufacturing contracts.
Written by Amit Madnani
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