Shares of this micro-cap stock jumped around 3 percent after the company secured an order worth Rs 230 crores from various Oil Manufacturing Companies (OMCs) for its Ethanol division.
With a market capitalization of Rs 345.77 crores, the stocks of Modi Naturals Limited opened their trading hour on Thursday at Rs 304 and currently trades at Rs 273.20, gaining around 3 percent as compared to the previous close of Rs 266.25 apiece.
Such favourable stock price movements were observed after the company, through a regulatory filing with the Bombay Stock Exchange (BSE), intimated that Modi Biotech Private Limited (MBPL), a wholly-owned subsidiary of Modi Naturals Limited, has received an order for 3.72 crores litres of ethanol worth Rs 230 crores from various OMCs.
The above order is decided to be fulfilled as per the ESY (Ethanol Sugar Year), viz, November to October period as followed by the company, in four phases. Along with ethanol, byproducts generated will also be sold separately adding to the company’s revenue.
“In addition to our strong position in the branded business division, we believe the ethanol segment will be vital to our growth in the future.”, commented Mr. Akshay Modi, Managing Director of Modi Naturals Limited.
The company commercialized the first grain-based ethanol distillery plant in Chattisgarh this year with a capital expenditure of Rs 150 crores. Moreover, the company, due to its promising performance, expects the division to be a growth driver for the company.
Having a walkthrough of the recent financials reported by the company, the basic business parameters such as operating revenues and after-tax profit figures have shown opposing movements.
The former, on one end, moved up from Rs 83.7 crores during Q1FY23-24 to Rs 91.86 crores during Q2FY23-24, and, the latter, on the other end, moved down from Rs 79 lakhs to Rs 76 lakhs.
As per the shareholding pattern data for the quarter ended September 2023, the company’s Promoters hold a 67.5 percent stake, Public (retail) investors hold a 30.77 percent stake, and the remaining 1.73 percent stake is held by the Domestic Institutional Investors (DIIs).
Founded in 1974, Modi Naturals Limited is engaged in the business of manufacturing and marketing edible oil and de-oiled cakes in India. The company offers both, consumer as well as B2B products to its customers with the main source of revenue being the sale of packing and other materials.
Written by Amit Madnani
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