Motilal Oswal Funds on 20 January bought a 2.5 per cent stake in Hi-Tech Pipes, a small-cap multibagger stock. On Monday, the stock gained 2.53% to reach a fresh 52-week high of ₹ 989.65 apiece on the National Stock Exchange (NSE). Its shares closed at ₹ 972.25 apiece.
Motilal Oswal AMC picked up 3 lakh equity shares of Hi-Tech Pipes on Friday. Motilal Oswal Equity Opportunities Fund Series II has bought 2 lakh shares in the company at ₹ 937 apiece while Motilal Oswal Business Advantage Fund Series II also bought nearly 1 lakh shares for ₹ 936.99 per share, via open market transactions.
Hi-Tech Pipes has given multibagger returns of 287.66% in the past two years as its share price increased from ₹ 250.80 to the current levels. 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 ₹ 3.87 lakhs today!
The company recently signed a MoU with the government of Uttar Pradesh to set up a mega manufacturing facility of steel tubes and flat steel processing with a proposed investment of ₹ 510 crores in a phased manner.
Meanwhile, the company’s board is scheduled to meet on January 28, 2023 to consider the sub-division/ split of its equity shares. In addition, the board will consider and approve the company’s quarterly results on the same date.
Hi-Tech Pipes is a small-cap company with a market capitalization of ₹ 1,184 crores. It has a return on equity of 17.39%, but a slightly high debt-to-equity ratio of 1.35. Its shares were trading at a price-to-earnings ratio of 39.03, which is significantly higher than the industry P/E of 11.74, indicating that the stock might be overvalued as compared to its peers.
Written by Simran Bafna
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