Stocks of Sterling Tools Limited are in the red today witnessing a deep fall in prices. The scrip currently trades at Rs 369, nearly 13 percent down as compared to the previous closing levels of Rs 423.30. In the last month, the stock has fallen approximately 15 percent ranging from Rs 432 to the current price levels.
Such bearish sentiments were observed after the company, through a regulatory filing with the exchange, announced their Q4 as well as annual results for FY22-23. Moreover, the company’s Board recommended a final dividend of Rs 2 per share (100 percent of its face value) for FY22-23.
Keeping the short-term impact on the stock prices aside, Sterling Tools Limited, in a year timeframe, has been successful in delivering multibagger returns of around 175 percent. It means that if someone would have invested Rs 1,00,000 in the stock, it would have converted to Rs 2,75,000 within the above-mentioned period.
The company is engaged in the process of manufacturing and trading high tensile cold forged fasteners. Various product categories offered by the company include Special Fasteners, Standard Fasteners, Engine Fasteners, and Chassis Fasteners. The company’s product portfolio includes nuts, bolts, washers of iron and steel, etc
Having a walkthrough of the financials reported on a QoQ basis, the operating revenues of the company increased from Rs 208 crores in Q3 v/s Rs 212 crores in Q4. On a contrasting note, the net profit figures, during the same period, moved down from Rs 14 crores to Rs 8 crores representing a 43 percent decline in numbers.
On a yearly basis, the company has maintained a decent growth in numbers with operating revenues moving from Rs 510 crores in FY21-22 to Rs 772 crores in FY22-23. Moreover, the net profits took a shift from Rs 26 crores to Rs 48 crores.
The profitability ratios have somewhat remained on the same levels with the return on equity (ROE) moving up from 7.37 percent during FY20-21 to 7.43 percent in FY21-22. Moreover, the return on capital employed (ROCE) of the company showed slight down movements from 9.3 percent to 9.24 percent keeping the timeframe the same.
The debt-to-equity ratio of the company has marginally reduced from 0.32 in FY20-21 to 0.31 in FY21-22.
Written by Amit Madnani
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