The share price of a multibagger auto stock in ace investor Vijay Kedia’s portfolio shot up 19.31 percent on Wednesday’s early trades to reach a fresh 52-week high of ₹ 453.45 apiece on the National Stock Exchange (NSE). This happened after the company announced the appointment of its chairman and managing director.
According to an exchange filing, Atul Auto has appointed Mr Jayantibhai J Chandra as Chairman and whole-time director of the company. Moreover, it has appointed Mr Neeraj J Chandra as its Managing Director. The voting in this regard was kept open from Friday, July 21, 2023, to Saturday, August 19, 2023 (both days inclusive), with more than 90 percent votes in favour of the resolution.
Atul Auto manufactures and sells auto rickshaws and their spare parts in domestic and overseas markets. Its applications include milk cans carrier, water bottle carrier, bread and bakery products carrier, edible oil tin carrier, vegetable van, pizza van applications and so on.
As per the latest shareholding pattern, Vijay Kedia holds 35,69,024 shares or a 13.70 percent stake in the company. Moreover, his company Kedia Securities Pvt Ltd. holds 3,21,512 shares or a 1.23 percent stake in the company.
The company’s share price has increased from ₹ 176.00 to ₹ 453.45 apiece or by 157.64 percent in the past year, to deliver multibagger returns. Therefore, if an investor had invested ₹ 1 lakh in the company’s shares five years ago, the value of their holdings would have been ₹ 2.57 lakhs!
With a market capitalization of ₹ 990 crores, Atul Auto is a small-cap company. It has a low return on equity of 1.28 percent and an ideal debt-to-equity ratio of 0.49. Its shares were trading at a price-to-earnings ratio (P/E) of 205.48, which is higher than the industry P/E of 16.16, indicating that the stock might be overvalued as compared to its peers.
Retail investors hold a 52.52 percent stake in the company, followed by promoters with 46.46 percent, mutual funds with 0.59 percent and foreign institutions with 0.43 percent.
Written by Simran Bafna
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