The shares of this smallcap company locked a 5 percent upper circuit after receiving an order of over Rs. 200 crores from Indian Railways. The stock has delivered more than 140 percent return to its shareholders in one year.
Price Movement:
With a market capitalization of Rs. 1,468 crores, the shares of Hind Rectifiers Ltd started Monday’s trading session on a higher note at Rs. 858.95, clocking a 5 percent upper circuit compared to its previous close of Rs. 818.05 apiece.
What Happened:
Such a bullish movement in the share price was observed after the company in an exchange filing announced that it had secured supply orders from Indian Railways worth over Rs. 200 crores. This contract is expected to be executed by the financial year 2025-26.
Financials:
Looking at the company’s financial statements, the revenue decreased by around 10 percent from Rs. 151.36 crores in the March quarter to Rs. 135.53 crores during the June quarter. Contrastingly, the net profits zoomed by 35 percent from Rs. 5.12 crores to Rs. 6.93 crores during the same period.
Also Read: Stock hits 5% upper circuit after signing agreement with Reliance Group
Important Financial Ratios:
In terms of key financial metrics, the company reported a return on equity of 10.04 percent and a return on capital employed of 23.65 percent for the period spanning FY23-24. Additionally, the net profit margin stood at 2.41 percent during the same timeframe.
Railway Sector:
Indian Railways has historically been the backbone of Hind Rectifiers’ business, providing a stable source of revenue through contracts for various electrical components used in locomotives and coaches.
The company’s long-standing relationship with Indian Railways has been bolstered by its commitment to quality and innovation in railway technology.
Furthermore, Hind Rectifiers is investing in research and development to create innovative products tailored for private rolling stock manufacturers.
This includes adapting to newer technologies and designs that meet the evolving needs of the railway sector, such as Distributed Power Rolling Stock (DPRS) systems used in modern trains like the Vande Bharat Express.
Defence sector:
In addition to railway applications, Hind Rectifiers is enhancing its presence in the industrial sector. This involves upgrading existing product lines and developing new solutions that cater to various industries, including power generation, defence, and aerospace.
Moreover, the company has achieved certifications for aerospace standards and registered with defence organizations, which is likely to bring an additional revenue stream in coming years.
Prominent Investor:
According to the BSE data, Ace Investor Mr Mukul Agrwal, entering the stock in March 2024, currently holds 2.23 lakh equity shares equivalent to a 1.30 percent stake in this company. The current holding value of his investment amounts to Rs. 19.2 crores.
Company Profile:
Incorporated in April 1958, Hind Rectifiers Ltd. is primarily engaged in developing, designing, manufacturing, and marketing Power semiconductors, Power Electronic equipment, and Railway Transportation equipment.
Also Read: Stock hits 5% upper circuit after receiving order worth ₹ 5.90 Cr from Larsen & Toubro
Written By Vaibhav Patil
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