This small-cap stock on Monday jumps up to 10% following the announcement of capacity expansion by the company. On the same day, the stock reached a new 52-week high of Rs. 1,466.25.
The stock has delivered 75% returns in six months and 72% returns in one year and currently the stock is trading above the 50-day and 200-day moving averages.
Styrenix Performance Materials Ltd
The company belongs to a small-cap category, with a market capitalization of Rs. 2,428.75 Cr. On Monday the stock rose up to 10%, at 12:00 p.m., shares were trading 3.5% up at Rs. 1,376.55 on the BSE.
According to the BSE filing, Styrenix Performance Materials Ltd has a capacity to manufacture 85 KT of ABS and KT of polystyrene per annum. Now, the company is planning to increase the annual capacity for ABS to 210 KT and Polystyrene to 150 KT in a phased manner over a period of next 48 months in the case of ABS and 36 months in case of Polystyrene.
The above-referred capacity expansion project is expected to require an investment of around Rs. 650 Cr, which would be funded using a mix of internal accruals and debt, subject to board approval.
Rationale
Both ABS and Polystyrene have been witnessing an increased demand in the domestic market and give the scope for adding new customers, new product applications and expanding the product portfolio, the expansion of production capacities will help in the business growth for the company.
The company’s total revenue grew by 8% from Rs. 553.60 Cr in Q2 FY23 to Rs. 598.03 Cr in Q2 FY24 and for the same period, net profit rose by 139% from Rs. 23.60 Cr to Rs. 56.41 Cr.
As per the latest shareholding data, Promoters hold 62.73%, FIIs hold 2.27%, DIIs hold 4.81% and the public hold a 30.19% stake in the company.
Styrenix Performance Materials Limited manufactures, trades, and sells engineering thermoplastics in India and around the world. It operates in two segments: Specialty and Polystyrene.
Written by Sheshadri N
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