Shares of an auto ancillary company appreciated to the tune of 4 percent to hit a record high of ₹ 617.95 apiece after it bagged an order worth ₹ 145 crores from Europe. At 02:21 PM, its shares were trading at ₹ 612.55, up 2.87 percent on the National Stock Exchange (NSE).
Ramkrishna Forgings manufactures and sells forged components of automobiles, railway wagons & coaches and engineering parts. It is a preferred supplier to OEMs like TATA Motors, Ashok Leyland, Volvo, Mack Trucks, Iveco, Ford Otosanand so on.
The Kolkata-based company informed the bourses that it was awarded a significant business contract valued at 16 Million Euros (approximately ₹ 145 crores). The contract spans a duration of four years and solidifies the company’s position in the European Original Equipment Manufacturer (OEM) sector.
The auto ancillary company has served the same OEM for the past five years by supplying front axle components and has now been entrusted with the production and delivery of differential components. The expansion into rear axle components stands as a testament to its quality and reliability in the eyes of the OEM, paving the way for further collaboration and growth in their partnership, and also enhancing the Company’s presence in the European market.
“We are delighted to have been awarded this significant contract, which not only attests to the quality of our products but also demonstrates the trust that OEMs place in our capabilities. This accomplishment underscores our dedication to innovation, precision, and customer satisfaction. We look forward to further fortifying our presence in the European market,” said Lalit Kumar Khetan, Whole Time Director & CFO, Ramkrishna Forgings.
Earlier this week, the company had bagged an order worth ₹ 107 crore from clients in the North American Region for the supply of rear axle and transmission components.
With a market capitalization of ₹ 9,509 crores, Ramkrishna Forgings is a small-cap company. It has an ideal return on equity of 20.67 percent and a debt-to-equity ratio of 1.01. Its shares were trading at a price-to-earnings ratio (P/E) of 34.82, which is higher than the industry P/E of 16.16, indicating that the stock might be undervalued as compared to its peers.
The company’s share price increased from ₹ 188.50 apiece to ₹ 617.95 in a span of one year, therefore the stock has delivered multibagger returns of 227.82 percent in the past year. If an investor had invested ₹ 1,00,000 in its shares a year ago, the value of their holdings would have been ₹ 3,27,820 today!
Written by Simran Bafna
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