Raghav Productivity hits new high ahead of meet for bonus; up 40% in 7 days

Raghav Productivity Enhancers shares hit a new high of Rs 1,308.20, as they surged 7% on the BSE in Thursday's intra-day trade ahead of board meeting on Friday, October 18 to consider bonus issue.

Raghav Productivity share price: Shares of Raghav Productivity Enhancers (REPL) hit a new high of Rs 1,308.20, as the scrip surged 7 per cent on the BSE in Thursday’s intra-day trade ahead of board meeting on Friday, October 18 to mull over a proposal to issue bonus shares. In comparison, the BSE Sensex was down 0.52 per cent at 81,072 levels, at 12:59 PM.

In the last seven trading days, the market price electrodes & refractories company has soared 40 per cent from level of Rs 934.10 on October 8. The stock has more than doubled or zoomed 128 per cent from the level of Rs 575 touched on June 4, 2024.

 

"Meeting of board of directors of the Company for the FY2024-25 will be held on Friday, October 18, 2024, to consider and approve the proposal for issue of bonus equity share subject to necessary approvals," the company said in an exchange filing on October 10.

The board will also consider the financial results for the quarter ended September 30, 2024 (Q2FY25), along with a proposal for some investments.

This is the second bonus issue in the past 15 months. Prior to this, as per BSE corporate action data, REPL had issued bonus shares last year on August 8, 2023, in the ratio of 1:1 i.e. one bonus shares for every one share held in the company as on record date.

In June quarter (Q1FY25), the company had delivered the highest ever quarterly revenue of Rs 44.8 crore, up 49 per cent year-on-year (YoY) backed by highest ever sales volume, growing 40 per cent YoY. Net profit grew 44 per cent YoY at Rs 8.3 crore. The company’s capacity utilisation on a consolidated level stood at 85 per cent. The management sees robust business visibility from existing clients and positive response of technical trials at new clients in domestic and export markets.

REPL is engaged in manufacturing and trading of Ramming Mass and other Quartz related items. The company is the leading producer of silica ramming and the only listed organised manufacturer of ramming mass in India. Despite intense competition, the group has established its position pan-India as a market leader in the ramming mass manufacturing segment, with superior product quality resulting in higher-than-average realisations.

RPEL is at the forefront of producing high-quality silica ramming mass, leveraging its exceptional properties. This material is highly esteemed for its chemical inertness, superior structural strength, remarkable erosion resistance, and compelling cost-effectiveness, making it a go-to choice for various industrial applications.

One major trend is the increasing demand for customised formulations of silica ramming mass to optimise furnace performance. Concurrently, ongoing research is focused on enhancing its thermal conductivity and resistance for extremely high-temperature applications, which is expected to further drive the demand.

The growth in the induction furnace market is being driven by several key factors. The government's strong commitment to boosting manufacturing capacity, through initiatives like the Make in India campaign and Production Linked Incentive (PLI) schemes, has played a significant role. Additionally, the rapid expansion of the railway sector and metro projects, leading to increased demand for smelting, mining, and metal alloy machinery, is fuelling the need for induction furnaces.

To meet this growing demand, India plans to rely on domestic steel production under its National Steel Policy, targeting a 175 million tons per annum (MTPA) increase in steelmaking capacity by 2030. This expansion necessitates the construction of numerous blast furnaces, thereby increasing the demand for refined metals and strengthening the adoption of induction furnaces, REPL said in its FY24 annual report.

In India, most steel and foundry manufacturers prefer domestically sourced silica (acidic) ramming mass due to its easy availability, timely procurement, and comparatively lower logistics costs for domestic purchases compared to exports. The domestic production of ramming mass in India is further supported by various government initiatives, including Make in India and Atmanirbhar Bharat campaign, which aim to reduce imports of silica ramming mass from China and other countries. India is also the world's largest exporter of silica ramming mass, with major export destinations including Saudi Arabia, Kenya, and Uganda, the company said.

The management said that the company is continually witnessing robust demand for its silica ramming products and are determined to strengthen its business mix to meet this growing need.  Looking ahead, the management said the company’s focus will be on expanding exports and leveraging its global footprint to tap into new markets.