With a market capitalization of Rs. 4,522.17 crores, Rajratan Global Wire Ltd. is a small cap company that serves the automobile industry.

With a market capitalization of Rs. 4,522.17 crores, Rajratan Global Wire Ltd. is a small cap company that serves the automobile industry. The company started off with making pre-stressed concrete wires and today makes bead wire for tyres. The company makes bead wire (112,000 TPA) for use in tyre industry and high carbon steel wire (12,000 TPA) used by auto and other industries. The stock closed at ₹ 880.00 per share on Friday, up 3.54 per cent from its previous close of ₹ 849.95, after reaching a 52-week high of ₹ 896.00. This comes after Rajratan Global consolidated June 2022 net sales reached ₹ 251.43 crore, up 37.93% Y-o-Y in Q1FY23. The stock reached a 52-week low on 22-July-21 at ₹ 350.42, meaning that it is currently trading 151 per cent above the 52-week low after reaching a 52-week high on Friday.

As per the consolidated financials of Q1 FY23, the company's operating revenue grew by 38% to ₹ 25,143 lakhs YoY which was ₹ 18,229 lakhs in Q1FY22. The company's EBITDA grew by 46% to ₹ 5,271 lakhs which was ₹ 3,602 lakhs in the same quarter of the previous year and EBITDA margin grew by 120 bps and stood at 20.96%. The company's profit before tax (PBT) grew by 59% to ₹ 4,571 lakhs YoY which was ₹ 2,875 lakhs in Q1FY22 and profit after tax (PAT) grew by 58% to ₹ 3,454 Lakhs which was ₹ 2,192 lakhs in Q1FY22 and PAT margin grew by 172 bps and stood at 13.74%. 

From Rs. 21.58 in June 2021 to Rs. 6.80 in June 2022, Rajratan Global EPS has declined. With increasing exports to other parts of the world, Rajratan currently holds a market share of around 45% in India and 24% in Thailand. The company can produce 40,000 TPA in Thailand and 72,000 TPA (60,000 TPA for bead wire) in India. The company is increasing capacity in Thailand to 60,000 TPA while also establishing a new greenfield facility in Chennai with a capacity of an additional 60,000 TPA. The company's average capacity utilisation has been maintained at 85%.

Commenting on the performance, Mr. Sunil Chordia, CMD, Rajratan Global Wire Ltd said “We have continued from where we left off in FY2022 and have continued to focus on outperforming on previous benchmarks across all our production, sales, productivity, customer service and performance metrices. 3 key levers namely our recent debottlenecking at our Pithampur plant, our Thailand plant expansion and our upcoming Greenfield capacity at Chennai will also help us to grow at our targeted 20-25% CAGR (in volume terms) over the next 3 to 5 years. We have also taken up digitisation efforts at our Pithampur (India) plant, which will also be replicated for our upcoming Chennai plant, this will help our production processes and systems become more efficient and smarter. Our rejection rates have continued to be below 0.02% in India which showcases our commitment to quality. Overall our entire team at Rajratan is geared up to “Outperform" on what we have already achieved."

The company has begun building and civil work at the new greenfield factory at Sipcot Industrial Park, Tamil Nadu close to Chennai for 60,000 TPA to target both domestic and overseas markets, according to a research filing. This will be in addition to India's current 72,000 TPA.

Rajratan Global share price history

The stock price rose from ₹ 37.28 to ₹ 880.00 in the past five years, representing a multibagger return of 2,260.52 per cent on the investment. The stock climbed from ₹ 392.12 on July 26, 2021 to the current level over the last 1 year, representing a multibagger return of 124.42 per cent. The stock has climbed from ₹ 413.29 as of January 3, 2022, to the present level on a YTD basis, producing a multibagger return of 112.93 per cent so far in 2022.

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