Shares of FMCG firm Hindustan Foods have given exceptional returns to its investors in the long run. In the last 10 years, the stock has skyrocketed over 40,000 percent.
From ₹1.4 in February 2013, the stock has surged as much as 40,489 percent to ₹568 currently. An investment of ₹1,00,00 in Feb 2013 in this stock would have turned to over ₹4 crore currently in just 10 years.
Meanwhile, it has advanced nearly 900 percent in the last 5 years and 320 percent in the last 3 years.
It has added 50 percent in the last 1 year, and 25 percent in 6 months but has lost 16 percent in the last 3 months.
The scrip has been flat but in the red, down half a percent in February 2022 so far after an over 8 percent decline in January 2022 and a 9.5 percent fall in December 2022.
However, before December, the stock gave positive returns in 5 straight months between July and November, rising over 93 percent in this period.
The stock hit its 52-week high of ₹749 in February 2022 and a 52-week low of ₹329 on June 21, 2022.
Hindustan Foods is a Midcap FMCG firm with a market cap of ₹6,224 crore. It was incorporated in 1984 and is promoted by the Marmagoa Shipping and Stevedoring Company Pvt Ltd (MSSC). The company manufactures nutritional foods cereal foods and products based on soya beans. It came out with a public issue in Nov.'87 to set up a food-processing unit at Ponda Goa.
The company started commercial production in January 1988 and the products were launched all over India only in December 1988 under the Bonny Mix brand name.
However, Glaxo which had participated in the equity of the company withdrew their participation in 1992-93an its brand name Bonny Mix was also acquired from Glaxo. Due to this, the firm witnessed a substantial fall in sales volume which led to major losses and had to close operations from December 1992 till December 1993.
Even after resuming production, the company's products did not do well in the Indian markets and it had to again discontinue production from July 1995 till October 1997.
Post the re-opening of production in 1997, the firm has been doing well. Its products now range from Personal Care, Home Care, to Food & Beverages and Leather.
In the December quarter, the company's net profit increased 46 percent to ₹17.1 crore versus ₹11.7 crore in the year-ago period. Its revenue jumped nearly 30 percent to ₹679.6 crore from ₹527.8 crore in the same quarter last year.
Commenting on the Financial Performance, Mayank Samdani, Group CFO said, “Our turnover for the quarter on a consolidated basis has increased by 29 percent YoY while the PAT rose by 46% YoY. The QoQ revenue numbers were flattish as it was the lean season for both beverages and ice cream and the QoQ numbers for PAT are strictly not comparable as the last quarter PAT numbers were buoyed by a one-time tax write-back arising due to our acquisition.
Our revenues for the 9MFY23 are the highest ever and our PAT for the 9-month period is higher than that of the entire past year. We expect our MAT credit to be utilized this year and will accordingly explore the possibility of moving to a lower tax rate under the new regime by next year.”
However, it is important to note that midcap stocks have a higher risk than large-cap stocks and one must consult their financial advisor before making any such investments.
Disclaimer: This story is for educational purposes only. Please speak to an investment advisor before making any investment decisions.