The shares of a small-cap company zoomed nearly 14 percent on Tuesday’s trades to reach a record high of ₹ 2036.30 apiece. This happened after the company reported robust results and announced a qualified institutional placement (QIP) issue.
PG Electroplast is a leading, diversified Indian electronic manufacturing services provider. It specialises in Original Design Manufacturing (ODM), Original Equipment Manufacturing (OEM) and Plastic injection moulding, catering to 50+ leading Indian and global brands.
On a consolidated basis, the company reported a 106.10 percent increase in its net profit at ₹ 33.80 crores for the April to June quarter (Q1FY24), against ₹ 16.40 crores reported in the corresponding quarter last year (Q1FY23). Its revenue from operations stood at ₹ 677.62 crores in Q1FY24, against ₹ 536.73 crores in Q1FY23, up 26.25 percent.
The company’s board of directors have approved a QIP, at a floor price of ₹ 1641.09 per equity share. Further, the company at its discretion may offer a discount of not more than 5 percent (five percent) on the floor price calculated for the QIP.
The company’s share price increased from ₹ 900.85 to ₹ 2,036.30, by 126 percent in the past year to deliver multibagger returns. In fact, its shares were available at ₹ 50.00 three years ago and have delivered multibagger returns of a whopping 3972 percent since then. If an investor had invested ₹ 1 lakh in the company’s shares three years ago, the value of their holdings would have been ₹ 40.72 lakhs today!
With a market capitalization of ₹ 4,066 crores, PG Electroplast is a small-cap company. It has a low return on equity of 14.83 percent and a debt-to-equity ratio of 1.46. Its shares were trading at a price-to-earnings ratio (P/E) of 42.85, which is lower than the industry P/E of 68.94, indicating that the stock might be undervalued as compared to its peers.
As per its latest shareholding pattern, its promoters hold a 61.20 percent stake in it, followed by retail investors with 35.67 percent, and foreign institutions with 3.13 percent.
Written by Simran Bafna
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