Shares of this smallcap company surged 7 percent in Friday’s trading session after reporting an increase in net profits by 567 percent YoY. The shares have delivered a multibagger return of 165 percent to its shareholders in one year.
With a market capitalization of Rs. 2,018 crores, the shares of Mishtann Foods Ltd started Friday’s trading session on a higher note at Rs. 18.99 compared to its previous close of Rs. 17.79. During the trading session, the shares hit a high of Rs. 19.10, gaining around 7 percent and are currently trading at Rs. 18.90 apiece.
Such a positive movement was observed after the company announced quarterly and financial year-end 31st March 2024 results. Quarterly, the revenue increased marginally by 2.13 percent from Rs. 330.52 crores during the December quarter to Rs. 337.57 crores in the March quarter. In addition, the net profits increased by 1.2 percent from Rs. 93.04 crores to Rs. 94.18 crores during the same period.
Comparing these metrics on a YoY basis, the revenue zoomed by 100 percent from Rs. 169.89 crores during Q4FY23 to Rs. 337.57 crores in Q4FY24. On the other hand, the net profits magnified by 567 percent from Rs. 14.13 crores to Rs. 94.18 crores during the same timeframe.
The company’s strong performance was primarily attributed to substantial contributions from a newly incorporated subsidiary and robust demand for various products in both domestic and international markets.
Furthermore, Mishtann Foods Ltd incorporated two new wholly owned subsidiaries (WOS) by the name of Grow and Grub Nutrients FZ-LLC in the United Arab Emirates (UAE) and Grow & More Nutrifoods Pte. Ltd in the Republic of Singapore. The move was aimed at tapping newer markets and increasing profitability margins.
Additionally, the company announced plans to establish a 1,000 KLPD grain-based ethanol manufacturing facility in Gujarat, following the execution of a Memorandum of Understanding (MoU) with the Government of Gujarat.
The project is expected to cost Rs 2,250 crores and is projected to generate an estimated annual revenue of Rs 3,500 crore. Mishtann aims to commence operations at the plant by the second quarter of 2026.
Moreover, the company plans to expand its business operations through the acquisition route by considering acquisitions both domestically as well as overseas.
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 36.17 percent during FY 21-22 to 39.72 percent in FY 22-23, and, the return on capital employed (RoCE) zoomed from 38.45 percent to 46.44 percent during the same timeframe. Further, the net profit margin increased from 6.30 percent during FY21-22 to 7.68 percent during FY22-23.
Headquartered in Ahmedabad, Mishtann Foods was incorporated in 1981. The company is a leading Indian company that specializes in the manufacturing, processing, and marketing of various food products, primarily basmati rice, wheat, pulses, and edible salt.
Written By Vaibhav Patil
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