Megastar Foods Ltd, a multibagger stock, hit the 5% upper circuit for the fourth day in a row and gained 28.88% in the past five days. Its shares are currently locked at ₹ 247.65 apiece, a fresh 52-week high. 34068 shares changed hands during Friday’s early trades on the Bombay Stock Exchange.
Megastar Foods is a prominent producer and supplier of wheat flour, organic wheat flour and a wide range of allied products in India. The company was incorporated in November 2011 and it started its operations in October 2013. Further, it got listed on the BSE SME platform on May 24, 2018.
Seasoned investor Ashish Kacholia bought a 1.04% stake in the company. He holds 103,666 shares, approximately worth ₹ 2.5 crores. The renowned investor publicly holds 39 stocks with a net worth of over ₹ 1,801.3 Crores.
Megastar Foods’ shares have given multibagger returns in the past year. Its shares rose from ₹ 43.00 to the current level, giving multibagger returns of 475.93%. If an investor would have invested ₹ 1 lakh in the shares of the company, a year ago, the value of their holdings would have been ₹ 5.76 lakhs today!
In fact, the share price of the company increased by 725.50% in the past two years. Therefore, if an investor would have invested ₹ 1 lakh in the company’s shares two years ago, the value of their holdings would have been ₹ 8.25 lakhs today!
The company commands a market capitalization of ₹ 226 crores. It has an ideal return on equity of 16.54% and an ideal debt-to-equity ratio of 0.96. Its shares are currently trading at a price-to-equity (PE) ratio of 31.22%, which is higher than the industry PE of 20.48. This indicates that the stock might be overvalued.
Written by Simran Bafna
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