Achieving consistent returns in the equity market is a daunting task, as share price volatility can lead to fluctuations in stock prices on any given day. However, there are a few stocks that have managed to deliver steady returns to their shareholders over an extended period of time.
These stocks weather the storm of market uncertainties, economic downturns, and industry disruptions, maintaining lower volatility and a consistent upward trajectory. Apar Industries is one such stock that has demonstrated its resilience and stability in the equity markets.
The company's shares have shown a steady growth trend over the past three years, increasing from approximately ₹296 apiece to ₹2,745 apiece, resulting in a stunning return of 827%. Over the last ten-year period, the stock recorded a gain of 1,747%.
Even during the first wave of pandemic, the stock declined by only 18.69% between March and October 2020. However, it quickly regained its position and surged 22% in the next two months.
This remarkable performance is particularly noteworthy when compared to the many other stocks that experienced losses ranging from a quarter to half of their value during the same period.
The stock has delivered impressive return of 123.47% and 129.91% in CY21 and CY22, respectively. Even in the current year, the stock has continued its upward trend, delivering a return of 53.98% so far.
The stock has seen losses in six out of the total 19 years since its listing in 2004, while it has shown positive returns in the remaining 13 years. On April 13, 2023, it spiked 6.2% to hit a life-time high of 2,862 apiece.
Apar Industries is a small-cap stock with a market capitalization of ₹10,500 crore. It is a leading Indian company operating in the diverse fields of electrical and metallurgical engineering offering value-added products and services in power transmission conductors, petroleum specialty oils, and power and telecom cables.
The company is the largest producer of aluminium and alloy conductors worldwide and is ranked third in the production of transformer oil globally, its website shows.
Industry experts believe that Apar Industries is well-positioned to benefit from the Indian government's increased focus on infrastructure, as well as in segments such as railways, defence, and renewable energy.
On the financial front, the company reported a 209% rise in the consolidated net profit to ₹170 crore for Q3 FY23. The company had posted a net profit of ₹55 crore in the same quarter last fiscal.
The consolidated revenue from operations during the quarter stood at ₹3,942 crore, growing by 76.85% as against ₹2,229 crore in the year-ago period.
The revenue from its conductors' segment, which accounts for 48% of the total revenue, increased by 103.23% to ₹1,911 crore in Q3FY23, as compared to ₹940.3 crore in Q3FY22. While the revenue from the transformers and speciality oils segment came in at ₹1,245 crore, an increase of over 37% YoY.
During the March quarter, the promoter owned 60.6% of the shares in the company, whereas foreign portfolio investors and domestic institutional investors held 6.7% and 18%, respectively. The remaining 14.8% of shares were owned by regular shareholders.
03 analysts polled by MintGenie on an average have a 'strong buy' call on the stock.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.