Shares of IFB Industries opened higher at ₹918.50 apiece in Wednesday's intra-day trade compared to the previous closing price of ₹909.85 on the BSE. The stock then rose to an intraday high of ₹984.80 or 8.25%, marking the largest intraday gain in the current month after a string of losses over the previous ten trading sessions. At 12:00 p.m., the stock was trading at ₹960, up by 5.62% on the BSE.
At current levels, the stock is trading 22.75% above its 52-week low of ₹800 and 24.40% below its 52-week high of ₹1,299.
The stock has witnessed sharp volatility in the current calendar year, hitting its one-year high and low in January and March, respectively. The consumer durable stock lost 19.01% of its value on a year-to-date (YTD) basis. Over the last six months, the stock has returned only 6.4%.
After reporting its September quarter earnings on October 28, the stock rose nearly 14.38% to ₹1,048 in the following three weeks, but it failed to sustain that bullish momentum.
IFB Industries posted a marginal drop in its standalone net profit of ₹24.2 crore for the September-ending quarter compared to ₹24.7 crore in the year-ago quarter.
It reported a 13.38 percent YoY rise in total revenue to ₹1,101.9 crore, compared to ₹971. crore in the same quarter of last year. The company's operating profit rose marginally by 0.28 percent YoY to ₹69.5 crore from ₹69.3 crore, while it was up 105 percent compared to the preceding quarter.
Growth in revenue in the September quarter was ₹131 crore; the Appliances Division contributed ₹82 crore towards this growth, followed by ₹30 crore by the Engineering Division.
Similarly, the EBITDA margin of the company dropped to 6.33 percent YoY in Q2 FY23 from 7.24 percent in Q2 FY22, falling by almost 91 basis points (bps).
Market demand for the Home Appliance division was stable in the 2nd quarter, though there was a slowdown in demand as compared to the 1st quarter. The overall demand scenario in the medium term remains healthy, and there is continued growth in demand for higher-end capacities, the company said in an exchange filing with the BSE.
The company expects the pressure on input costs to ease beginning in the third quarter, which will help improve margins in the future.
The Engineering Division improved marginally in the second quarter, due to a decrease in commodity prices and thereby an overall decrease in vehicle prices, leading to early signs of recovery, it said.
Meanwhile, the FIIs have steadily reduced their stake in the company to 0.6% in the second quarter of FY23 from 7.71% in the September 2021 quarter, Trendlyne data showed. The promoters owned 75% of the shares in the company, while domestic institutional investors and regular shareholders each owned 4% and 20%, respectively, during the second quarter of the current fiscal year.
An average of 03 analysts polled by MintGenie have a 'buy' call on the stock.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.