scorecardresearchFIIs raise stake in GMM Pfaudler to all-time high of 19%; stock down over 5% in last one year

FIIs raise stake in GMM Pfaudler to all-time high of 19%; stock down over 5% in last one year

Updated: 18 Jan 2023, 11:58 AM IST
TL;DR.
FIIs raised their stake in GMM Pfaudler to 19% in December quarter. In the same quarter of the previous fiscal year, FIIs owned a 10.9% stake in the company. DIIs also raised their holdings to 10.7% in Q3FY23.
In Q2FY23, the company's net profit increased by roughly 149% to  <span class='webrupee'>₹</span>97 crore from  <span class='webrupee'>₹</span>39 crore in the corresponding quarter of the previous fiscal year.

In Q2FY23, the company's net profit increased by roughly 149% to 97 crore from 39 crore in the corresponding quarter of the previous fiscal year.

GMM Pfaudler, an engineering firm, saw its foreign institutional investor (FII) holdings reach an all-time high of 19 percent in the December quarter. In the same quarter of the previous fiscal year, FIIs owned a 10.9 percent stake in the company.

FIIs have been increasing their stake in the firm steadily, but the majority of the increase happened in the most recent quarter. Back in the September 2022 quarter, FIIs' stake stood at 11.7 percent.

Among some key foreign investors, Indus India Fund (Mauritius) Ltd. increased its stake in the company to 2.80 percent in Q3FY23 from 2.18 percent in Q2FY23, Trendlyne data showed.

A similar trend was seen when it comes to domestic institutional investors (DII), who raised their holdings to 10.7 percent in the December quarter from 6 percent in Q3 FY22.

Similarly, general shareholders increased their stake in the company to 31.6 percent in Q3 FY23 from 26.6 percent in Q2 FY23, according to Trendlyne data. 

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Stock price Chart of GMM Pfaudler.

Meanwhile, promoters trimmed their holdings to 38.7 percent in the third quarter of the current fiscal from 56.1 percent in the preceding quarter. 

On December 16, Pfaudler Inc divested a 17.3 percent stake in the company for Rs. 1,324 crore through open market transactions, according to stock exchange data.

After the promoter stake sale, shares of GMM Pfaudler crashed 23 percent in just five trading days. Over the last one year, the stock has fallen by 5.7 percent, sliding from 1,639 apiece to 1,595.75.

However, over the last three years, the stock gained 117.76 percent, while over the last five-year period, it rose by a stunning 546.4 percent.

Brokerage firm Axis Securities has maintained its "buy" call on the stock with a target price of 2,444 apiece. 

GMM Pfaudler is a play on the manufacturing shift of chemicals and pharmaceuticals from China and developed markets to India, which will be a strong theme for the next decade, said the brokerage.

In Q2FY23, the company's net profit increased by roughly 149 percent to 97 crore from 39 crore in the corresponding quarter of the previous fiscal year.

The company's revenue from operations rose 20.52 percent to Rs. 780.05 crore in Q2 FY23 from Rs. 647.24 crore recorded in Q2 of last fiscal.

EBITDA stood at 119 crore in the quarter that ended September 30, 2022, registering a growth of 27 percent from 94 crore posted in Q2 FY22. EBITDA margin also improved to 15.2 percent during the quarter from 14 percent reported in the same period a year ago.

 

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.

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First Published: 18 Jan 2023, 11:56 AM IST