This micro-cap stock resumed trading after 40 months; zooms 71% in 10 days

Shares of Atlas Cycles (Haryana) were locked in the upper circuit for the 10th straight day, up 10 per cent at Rs 112.78 on the BSE in Friday’s intra-day trade. In the past 10 trading days, the stock of this micro-cap company zoomed 71 per cent from a level of Rs 66.13 on the BSE.

 

Till 02:04 PM; a combined 30,000 equity shares changed hands and there were pending buy orders for around 600,000 shares on the NSE and BSE. In comparison, the BSE Sensex was trading 0.02 per cent lower at 77,603. Currently, Atlas market capitalisation stands at Rs 73.31 crore. Last, on August 2, 2021, the stock price of Atlas closed at Rs 29 on the BSE, the exchange data shows.

 

The exchanges revoked the suspension in trading of equity shares of Atlas with effect from December 27, 2024. The trading in the securities of the company will be resumed in “T” group, BSE had said in notice dated December 19, 2024. The T group is a surveillance measure that requires securities to be settled on a trade-to-trade basis.

 

The trading of shares was suspended by the BSE Limited and National Stock Exchange of India Limited with effect from December 16, 2020 due to non-filing/ delay in filing of financial results of the company, Atlas said in its FY24 annual report.

 

As on September 30, 2024, Atlas has total 6.5 million outstanding shares of which, 41.92 per cent stake was held by the promoters. The remaining 58.08 per cent stake were with resident individual investors (50.23 per cent), bodies corporate (2.31 per cent) and non resident Indians (NRIs) (1.03 per cent), the shareholding pattern data shows.

 

Atlas on January 6, 2025 said the movement in company’s share price is purely due to market conditions on which company has neither control nor has any knowledge of reasons.

 

“We would like to clarify that the company has intimated/ disclosed to the exchange, every relevant events/ information from time to time which could have any impact on performance of the company, which include all price sensitive information etc. as required to be disclosed under listing regulations,” the company said on clarification on the significant movement in price of the company’s security.

 

Further, no such disclosure/information/announcement etc. is withheld or pending to be disclosed which could have a bearing on the company’s securities’ price movement, it added.

 

Atlas is engaged in manufacturing of bicycles and bicycles components. Bicycle industry has continued to show a growth of around 4 to 5 per cent during last two years inspite of general slowdown in the economy. 

 

Standard bicycle segment which contributes around 55 per cent of the total sales is growing marginally as compared to Fancy and Kids segments which are growing at 7 to 8 per cent every year. Fancy cycles with features like disc brakes, shockers, alloy wheels and gears are driving the sales particularly in metro and mini-metro cities. With rising income of the middle class, fancy segment especially the kids segment is showing a very healthy growth, the company said in its FY24 annual report.

 

India is the second largest manufacturer of bicycles in the world. Unlike the developed nations where bicycles are used primarily for health & recreational purposes, India needs bicycles for socio-economic empowerment of 1/3rd of its populations. Growth in population, health consciousness and socioeconomically sustainable rural development are most important demographic trends promoting bicycles as the obvious choice of transportation in future. Out of the total quantity sold, approximately 55 per cent bicycles are roadsters, 25 per cent fancy and about 20 per cent meant for kids. With rising income of the middle class, fancy and kids segment will grow at a much faster pace as compared to normal roadster cycles, the company said.

 

However, small manufacturers from unorganized sectors are increasing their market presence every year. With little infrastructure and low overheads, they are able to supply bicycles at a very low price as compared to the organized sector because of which profitability of the industry is under stress. Though they are not supplying very good quality products and their after sales service is not comparable, but because of the price advantage, their sales volume is increasing every year, the company said.