The Indian stock market has been facing a high degree of volatility since the beginning of the year, with the majority of stocks hitting significant ups and downs. However, amidst this turbulence, one small-cap stock has managed to stand out from the rest and deliver exceptional returns to its investors.
In the last one month, the shares of WPIL Ltd have moved from ₹1,168 apiece to the current level of ₹2,328, representing a remarkable gain of almost 100%. The surge in the company shares has been fueled by a range of factors, including the company's strong performance in the December quarter and order wins.
The stock began its upward rally on February 09, and it has remained in the same momentum to date, breaking new highs with each passing day. During Wednesday's trade, the company's shares rallied 6.61% to mark a new record high of ₹2,355 apiece.
The stock has seen a meteoric rise of over 180.48% from its one-year low of ₹830, and it has produced a staggering return of 752% in the last ten-year period.
WPIL has a market capitalization of ₹2,275 crore. The company is in the business of designing, developing, manufacturing, erecting, commissioning, and servicing pumps & pumping systems. The company has a track record of operation spanning more than six decades in the pumps industry, its website shows.
The company operates two manufacturing units in Kolkata, one in Ghaziabad, Uttar Pradesh, and two in Maharashtra. Since 2011, the company has been expanding its operations globally through strategic acquisitions and joint ventures.
On March 03, the stock was locked in a 10% upper circuit limit after the company announced that it had received a Letter of Acceptance (LOA) from Madhya Pradesh Jal Nigam Maryadit for the execution of turnkey projects.
The projects include engineering, procurement, construction, testing, commissioning, and 10 years of operation and maintenance of Bebus Sunar 2, Kutne Rajnagar, Lower Narmada, and Mann Dam multi-village schemes for a total value of ₹1,225 crores to be completed in a 24-month period.
In the recent December quarter, the company delivered a strong performance, as it reported its highest-ever quarterly net profit of ₹84 crore. The company had posted a net profit of ₹15 crore in the year-ago quarter and ₹26 crore in the preceding quarter.
For the 9MFY23, the company delivered a net profit of ₹140 crore, an increase of 145% compared to ₹57 crore in the same period of the last fiscal.
The consolidated revenue from operations has increased by 17.68% to ₹507 crore in Q3FY23 as compared to ₹247 crore in Q3FY22. The operating profit came in at ₹106 crore, a surge of 211% YoY, while the operating profit margin expanded by 700 bps YoY to 21% in Q3FY23.
In Q3FY23, the company improved its earnings per share, which rose to ₹71.46 from ₹13.44 in Q3 FY22. In the June-September quarter, the EPS stood at Rs. 23.93.
At the prevailing price, the stock trades at a price-to-earnings multiple of 13.4x, which is much lower compared to the industry P/E of 49.7x.
On the financial ratio front, the company has a debt-to-equity ratio of 0.4x, Trendlyne data showed, while it had an ROE and RoCE of 12.18% and 17.85%, respectively, in FY22.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.
