Ashish Kacholia’s Stock Records Over 100% Growth with Heavy Buying

Shares of Shankara Building Products Limited gained about 6% today. The stock has witnessed heavy buying activity from investors. Shankara Building Products approved a demerger plan to unlock business value. The company’s trading business will be transferred to its wholly-owned subsidiary, Shankara Buildpro, on a going concern basis.

Shareholders will receive 1 new share for every 1 existing in the building products share held, unlocking the distinct potential of each business. This demerger is subject to statutory and regulatory approvals. The company has also announced impressive quarterly results.

Shankara Building Products Limited has delivered multibagger returns to its shareholders in the last three years. During this period, the company’s share price surged from Rs 349.35 on December 24, 2020, to Rs 766 on December 19, 2023, representing an increase of over 100% in a three-year holding period. An investment of Rs 1 lakh in this company’s shares three years ago would have grown to Rs 2 lakh today.

Financial Performance

In Q2FY24, the company posted 26% growth in its consolidated revenue at Rs 1,142.49 crore compared to Rs 906.72 crore from the previous year’s corresponding quarter. The operating profit of the company stood at Rs 36.25 crore, while the PAT of the company stood at Rs 18.21 crore, representing an impressive growth of 17.33% YoY.

Business Overview

Shankara Building Products Limited is a leading organized retailer of home improvement and building products in India, Operating under the brand name ‘Shankara Buildpro’. The company runs 100+ stores spread across Karnataka, Kerala, Andhra Pradesh, Telangana, Tamil Nadu, Maharashtra, Gujarat, Orissa, Madhya Pradesh and Puducherry. It started operations in 1995 and is headquartered in Bangalore. The company sell over 30,000+ SKUs across the entire home construction and renovation lifecycle through its retail stores.

Stock Price Movement

Today, the stock opened at Rs 730.75, with a high and low of Rs 800.90 and Rs 730.15, respectively. The stock closed trading at Rs 756.80, which increased by 6.58%. The stock has a 52-week high of Rs 929.30 and a 52-week low of Rs 574. The company has an ROCE of 15.6% and an ROE of 10.8%, with a market capitalisation of Rs 1,748 crore.

The stock has shown impressive growth, and investors should keep a close eye on this stock.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.