Shares of this smallcap company jumped around 2 percent in Thursday’s trading session after the board approved setting up a Free Trade Warehousing Zone. The shares have delivered a multibagger return of 120 percent to its shareholders in one year.
With a market capitalization of Rs. 4,119 crores, the shares of Balmer Lawrie & Company Ltd started Thursday’s trading session on a higher note at Rs. 240.25 compared to its previous close of Rs. 237. During the trading session, the shares hit a high of Rs. 244.80, gaining around 2 percent and are currently trading at Rs. 241 apiece.
Such a positive movement in the share price was observed after the company in an exchange filing announced that they received approval from the board of directors for setting up a free trade warehousing zone on 15 acres of land in the special economic zone of the Jawaharlal Nehru Port Authority for Rs. 230 crores.
The decision taken by the board of directors is to consider expanding the company’s operations into related business areas within the logistics sector, aligning with its strategic objectives. Given the substantial industrialization and growth in the warehousing sector in the Jawaharlal Nehru Port Authority, it presents an ideal opportunity to establish a Free Trade Warehousing Zone (FTWZ).
Further, the company mentioned that besides potential revenue growth, the initiative also has the potential to contribute to local employment within the region.
Coming onto the company’s financial statements, the revenue decreased marginally by 0.71 percent from Rs. 586 crores during the September quarter to Rs. 585 crores in the December quarter. On the other hand, the net profits increased by 5 percent from Rs. 63 crores to Rs. 66 crores during the same period.
Furthermore, the company aims to enhance its product portfolio by introducing new products to cater to evolving market demands and expand its offerings and plans to tap into new markets through exports, aiming to increase its global presence and reach a wider customer base.
Due to increasing operating revenue and profits on a YoY basis, the profitability metrics of the company improved with the return on equity (RoE) increasing from 5.67 percent during FY 21-22 to 6.54 percent in FY 22-23, and, the return on capital employed (RoCE) zoomed from 8.51 percent to 9.95 percent during the same timeframe. In addition, the net profit margin increased from 4.32 percent during FY21-22 to 4.60 percent during FY22-23.
Headquartered in Kolkata, Balmer Lawrie & Company was incorporated in 1924. The company is engaged in the business of Industrial Packaging, Greases and Lubricants, Leather Chemicals, Logistic Services and Infrastructure, Refinery and Oil Field and Travel & Vacation Services in India.
Since 1972, it has been a central public sector undertaking under the administrative control of the Ministry of Petroleum and Natural Gas, GoI.
Written By Vaibhav Patil
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