Shares of Brightcom Group have been delivering surprising returns to its investors. A bet on the stock just a year ago would be increased over 30 times in this short period.
The stock jumped from ₹5.6 on February 2, 2021, to ₹180.95 on February 2, 2022, surging as much as 3,131 percent in just 1 year. An investment of ₹1,00,000 last year would have turned to over ₹32 lakh currently.
Not only in the last year, but the stock has also rallied over 7,200 percent in the past 3 years.
It has a market capitalisation of ₹18,395 crore and hit its all-time high of ₹204.80 in late December last year.
The Brightcom Group is a digital marketing company founded in 2000 and headquartered in Hyderabad, India with offices across the world in US, Argentina, Brazil, Mexico, UK, France, Germany, Sweden, China, India, Australia, etc.
As per the company's website, it consolidates Ad-tech, New Media and IoT-based businesses across the globe, primarily in the digital eco-system. Its clients include leading blue-chip advertisers like Airtel, British Airways, Coca-Cola, Hyundai Motors, ICICI Bank, ITC, ING, Lenovo, LIC, Maruti Suzuki, MTV, P&G, Qatar Airways, Samsung, Viacom, Sony, Star India, Vodafone, Titan, and Unilever.
In the December quarter, the company's profit stood at ₹26 lakh, up considerably from ₹3 lakh in the year-ago period. Its revenue came in at ₹93 crore in Q3 2021 vs ₹83 crore in Q3 2020. The board of directors also approved a bonus issue in the ratio of 2:3 along with the results of the latest quarter.
However, despite the dreamy rally, analysts advise caution while investing in the stock. As per market experts, the company has a very weak presence among the DIIs and FIIs despite a very high market cap, which is worrisome. Further, the consistently reducing promoter holding over the years also does not instill a lot of confidence in the stock.
It has also never been consistent with dividends and hosts a number of corporate governance issues. Hence, if you are an investor with a high-risk appetite, you can consider investing in the stock, however, for investors with a low-risk appetite, it would be safer to skip the stock despite the tremendous returns.