Rs10,000 turned to 2 lakh in just 1 year| Steel Producing company available in discount

New Delhi: In this article we talk about a Steel producing company which has given multibagger returns to its investors almost 2224% returns in last 1 year and 8,253% returns in just last 5 years.

A Rs 10,000 investment in this stock in January 2023 would now be worth Rs more than 2 Lakh. There is still a chance to make profit from this stock because foreign Institution have increased their share holding. All brokerage firms and various research firms and analyst have the bullish point on this company.

Introduction

This steel producing company is Jai Balaji Industries Ltd which is a prominent player in Iron and Steel Industry. This company has the diverse portfolio of value added products including Sponge Iron, Pig iron, Ferro Alloys, Alloy and Mild Steel Billets, Reinforcement Steel TMT Bars, Wire Rods, Ductile Iron Pipes, and Alloy and Mild Steel Heavy Rounds with a combined capacity of 27,40,000+ tones per annum.

Jai Balaji Group having 8 integrated manufacturing units across India. The company is dedicated towards innovation and excellence in producing safe and sustainable products for global customer base.

Stock Performance

Compounded Sales Growth 5 Years = 21%

Compounded Sales Growth 3 Years = 28%

Compounded Profit Growth 5 Years = 21%

Compounded Profit Growth 3 Years = 48%

Stock Price CAGR 5 Years = 142%

Stock Price CAGR 3 Years = 251%

Return on Equity 1 Year = 39.21%

Quarter 3 Performance

• The net sales decreased from 1,547% to Rs 1,539 crore.
• Profit Before Tax (PBT) increased from Rs 202 crore to Rs 235 crore.
• The Net Sales decreased by 23.87% to Rs 235.20 crore in nine months.
• The Net Profit has been increased from 202 crore in Q2 to 235 crore in Q3.

Company Overview

Jai Balaji Industries Ltd was incorporated in 1999, engaged in manufacturing of Iron and Steel products. Jai Balaji Industries Ltd is India’s 2^nd largest company in steel and Iron manufacturing in terms of Market Cap.

Company’s promoter has pledged their 30% holding for increasing the manufacturing capacity of the company. Company’s 52 week low share price was Rs 42.10 and currently share price is trading at 52 weeks high at Rs 1,194.55.

Company has reduced its borrowings from Rs 3,434 Cr in Mar 2021 to Rs 660 Cr in Sep 2023. Total assets of the company is at all time high.

Financials

Net-Profit Margin

Strength

• Promoters of this company have increased their share holding in significant amount.

• Cash Conversion cycle has improved.

• Inventory days have reduced significantly.

• Foreign Investors are increasing their holding in this company.

• The Company has delivered good profit growth of 21.1% CAGR over last 5 Years.

Weakness

• Net Cash Flow is very low

• Promoters have pledged 32% of their holding.

• The company is reporting repeated profits but not paying out dividend.

Competitor

Conclusion

Jai Balaji Industries Ltd has given multibagger returns to its investors in past, and still hoping for future as well. As foreign investors have increasing their holding in this company can boost the share price in future.

Disclaimer: I am not a SEBI-registered investment adviser or research analyst. The information shared is only for educational purposes. This is not an investment advice.

om katiyar

Om Katiyar is founder of Stockmoodys. He is MBA Professional in Finance with a keen interest in stock market. Mr. Katiyar has 6 years of experience in finance and stock market. He likes to research about stocks and share his insights to make investing simplify.