Multibagger alert: This industrial solution providing company soared over 2000% in 2 years!

Multibagger alert: This industrial solution providing company soared over 2000% in 2 years!

by 5paisa Research Team Last Updated: Dec 14, 2022 - 11:32 pm 22.4k Views
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During the same period, the frontline index S&P BSE Sensex has appreciated by only 51%.

CG Power and Industrial Solutions Ltd, a motor and generator manufacturing company, has delivered multibagger returns to its shareholders in the last two years. During this period, the company’s share price climbed from Rs 8.38 on 14 July 2020 to Rs 200.85 on 08 July 2022. This price movement exhibits an appreciation of 2296% during the two years, heavily outperforming the markets.

CG Power and Industrial Solutions Limited is an Indian multinational company engaged in the design, manufacturing, and marketing of products related to power generation, transmission, and distribution & Rail Transportation. The company was previously known as Crompton Greaves Limited. The company’s diverse portfolio ranges from transformers, switchgear, circuit breakers, network protection & control gear, project engineering, HT and LT motors, drives, Power Automation Products and turnkey solutions in all these areas. 

Looking at the financial performance, in the last 1 year, the company’s net revenue has increased 87.69%. The revenue increased from Rs 2963.95 crore in FY21 to Rs 5561.40 in FY22. Similarly, the PBIDT increased by 206% to Rs 697.20 crore. The PAT during the year stood at Rs 913.42 crore, a de-growth of 28.6% YoY due to an exceptional gain in the previous year.

Owing to a beta of 0.88, the company is relatively cushioned from the fluctuations arising from market volatility. On the valuations front, the company is trading at a TTM PE of 33.59x against an industry PE of 74.20x. In FY22, it delivered a stellar ROE and ROCE of 90.99% and 84.18% respectively.

The key to this multibagger performance

In November 2020, the company was acquired by Tube Investments of India. FY22 was the first full year of operations under the new management. This financial year has been a defining year, seeing the complete operational and financial turnaround of the company. All the businesses bounced back and performed to their potential, regaining the confidence of customers and vendors. Moreover, during the year several legacy issues were resolved leading to an improved financial/financial rating of the company.

At 2.23 pm, the shares of CG Power and Industrial Solutions Ltd were trading at Rs 204.20, an increase of 1.67% from the previous closing price of Rs 200.85 on BSE. The stock has a 52-week high & low of Rs 219.60 and Rs 71, respectively on BSE.


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