Shares of Vikas Lifecare climbed 10.91% by Thursday’s closing bell to reach an intraday high of ₹ 3.05 apiece, after the company received a huge order.
Vikas Lifecare is engaged in the business of polymer, rubber compounds and additives for plastics, synthetic and natural rubber. Additionally, it is also a del-credere agent of ONGC (Oil and Natural Gas Corporation Ltd.) Petro Additions Limited. The company forayed into the B2C segment with a host of consumer products including FMCG, agro, and infrastructure products as a long-term business strategy.
According to an exchange filing, the company’s agro division has bagged fresh orders worth ₹ 155 million and this order is to be executed in the second quarter of the current financial year. This division achieved sales of ₹ 480 million before this order, and it targets a goal of ₹ 3600 million for the current fiscal, as compared to ₹ 2000 million accomplished during the previous fiscal.
The company mentioned that it is eyeing export orders and is poised to scale up the agro-business division. Moreover, it is looking for appropriate opportunities for backward integration for the division and is considering and evaluating proposals for establishing or acquiring a rice processing facility by 2024-25. It said that this will elevate the scope of business and will add to the company’s performance in the National as well as International markets with better sales volumes and profit margins.
With a market capitalization of ₹ 396 crores, Vikas Lifecare is a penny stock. It has a negative return on equity of 5.77% but an ideal debt-to-equity ratio of 0.09. Retail investors hold a massive 88.31% stake in the company, followed by promoters with 11.36% and foreign institutions with 0.33%.
Investors should note that penny stocks are highly risky investments. They may have the tendency to deliver massive returns, however, they also have the potential to wipe away an investor’s capital. They may even get delisted. Investors should conduct extensive research before investing in such stocks, and invest according to their risk appetite.
Written By Simran Bafna
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