Shares of this penny stock under Rs 20 hit its 5 percent upper circuit in Thursday’s trading session after the company’s Board of Directors (BOD) scheduled a meeting to consider and approve fundraising.
With a market capitalization of Rs 163.56 crores, the stocks of S.A.L. Steel Limited started their trading session on Thursday at Rs 19.25, and after some ups and downs, the stock again settled at the same price which is also registered as the share’s 5 percent upper circuit compared to the previous close of Rs 18.35 apiece.
Such sharp share price movements were observed today after the company, through a recent filing with the National Stock Exchange (NSE), intimated about the company’s Board of Directors (BOD) scheduling a meeting on Saturday, 11th May 2024.
The meeting will be held to consider and approve the proposal of fundraising by the issuance of equity shares/ convertible bonds/debentures/ convertible equity warrants/ preference shares/ equity-linked securities and/or any combination thereof through permissible modes.
During the recent financial quarters, the company’s prime business parameters, viz, its operating revenues as well as after-tax profits, witnessed underperforming numbers with the former reducing from Rs 157 crores during Q2FY24 to Rs 129.53 crores during Q3FY24, and the latter, during the same period, falling from profits of Rs 14 lakhs to losses of Rs 2.48 crores.
In addition to the above, the company’s ratio analysis portrays the return ratios, i.e., the return on equity (RoE) as well as the return on capital employed (RoCE), are on a downward move with the recent numbers, as per FY23, of RoE being 8.53 percent and of RoCE being 7.12 percent.
Incorporated in 2003, S.A.L. Steel Limited is engaged in manufacturing and selling sponge iron and ferroalloys within as well as outside India. The company operates through two broad segments, viz, ‘Iron & Steel’ and ‘Power’ segments. In addition, the company also offers finished steel and other iron ore pellet products.
Written by Amit Madnani
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