Shares of this smallcap company surged around 14 percent in Monday’s trading session after the board plans to consider bonus shares. The shares have delivered around 40 percent return to its shareholders in six months.
With a market capitalization of Rs. 3,031 crores, the shares of M M Forgings Ltd started Monday’s trading session on a higher note at Rs. 1,222 compared to its previous close of Rs. 1,127.35. During the trading session, the shares hit a high of Rs. 1,300, gaining around 14 percent, also recorded as the company’s fresh 52-week high and closed the day at Rs. 1,266 apiece.
Such a bullish movement in the share price was observed after the company in an exchange filing announced that the Board Meeting of the company is scheduled to be held on Wednesday, 29 May 2024 for the consideration and approval of the Audited Standalone and Consolidated financial results for the quarter and year ended 31 March 2024 and declaration of dividend.
Furthermore, the company also stated that they would consider the proposal for the issuance of Bonus Shares to the shareholders, subject to the approval of shareholders in their Meeting scheduled to be held on 29 May 2024.
This will be the first time in six years that M M Forgings will be issuing bonus shares to shareholders. Previously, It had last issued bonus shares back in 2018, when it issued one free share for every one held.
Coming onto the company’s financial statements, the revenue increased by 2.3 percent from Rs. 388.37 crores during the September quarter to Rs. 397.37 crores during the December quarter. On a contrasting note, the net profits decreased by 5 percent from Rs. 35.45 crores to Rs. 33.54 crores during the same period.
Furthermore, the company plans to enter the EV market in the second half of FY2025 and aims to achieve a turnover of 1,000 to 2,000 crores in the EV business over the next 7 to 10 years. Moreover, MM Forgings currently has 10 plants with a total capacity of 1.1 lakh metric tonnes per annum (MTPA).
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 16.65 percent during FY 21-22 to 19.85 percent in FY 22-23, and, the return on capital employed (RoCE) zoomed from 13.50 percent to 15.70 percent during the same timeframe. Additionally, the net profit margin increased from 7.99 percent during FY21-22 to 8.75 percent during FY22-23.
Headquartered in Chennai, M M Forgings was incorporated in 1946. The company is engaged in the business of manufacturing Steel Forgings in raw, semi-machined and fully machined stages in various grades of Carbon, Alloy, Micro-Alloy and Stainless steel.
Written By Vaibhav Patil
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.
