Multibagger stock hits upper circuit after reporting 264% jump in net profit; Also declares stock split of 5:1

The shares of Servotech Power Systems Limited hit an upper circuit of 5 percent at Rs 191.45 in the early hours of Monday. The scrip gained after the company reported robust Q3 results. 

In Q3FY23, Servotech reported a total revenue of Rs 83.27 crore which is a jump of more than 101 percent from R 41.42 crore during the previous quarter ended in December 2021. 

Their net profits in the quarter jumped by 264 percent to be at Rs 3.58 crore in the quarter ended December 2022 as against Rs 1.06 crore in the same period a year earlier. 

Further, the company also announced two corporate actions. Servotech Power Systems has declared an interim Dividend of Re 0.20 per equity share of the Company for the Financial Year 2022-23. 

In addition to that, the board of the company has announced a stock split. The company will subdivide 1 (one) equity share of a face value of Rs 10 each into 5 (five) equity shares of a face value of Rs 2 each. For both purposes, the record date has been set as February 3rd, 2023. 

Servotech Power Systems is engaged in end-to-end manufacturing, procurement, and distribution of a range of high-end yet advanced solar products, medical devices as well as energy-efficient lighting solutions. The company is also gearing up to provide high-tech EV charging equipment. 

The NSE listed stock has risen from Rs 58.70 levels in July 2022 up to the current levels logging a multibagger return of 227 percent. An investment of Rs 1 lakh then would be worth Rs 3.27 lakhs in just six months. 

In the past five days, the stock has jumped by more than 17 percent and in a month it has scaled up by more than 40 percent. The small-cap company has a market capitalization of Rs 407 crores and a dividend yield of 0.10 percent. 

The promoters of the company hold a 60.59 percent stake and have pledged 11.34 percent of it. In addition, Foreign Institutional Investors (FIIs) have freshly increased their stake by 9.42 percent in the December quarter. 

Written by Anoushka Roy

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