This Ashish Kacholia stock has zoomed 55% in July; up 125% from June low

Shares of Balu Forge Industries hit a new high of Rs 501, surging 7% on the BSE in Tuesday's intra-day trade and rallied 23% in four days. Company to announce Q1 results today.

Shares of Balu Forge Industries (BFIL) hit a new high of Rs 501, surging 7 per cent on the BSE in Tuesday’s intra-day trade amid heavy volumes.

The stock of the leading precision engineering and manufacturing company was trading higher for the fourth straight day, up 23 per cent during the period. Thus far in the month of July, it has surged 55 per cent. The market price of BFIL has zoomed 125 per cent from the previous month low of Rs 223 touched on June 4.

At 01:15 pm; the stock was trading 5 per cent higher at Rs 491.30, as compared to 0.4 per cent rise in the BSE Sensex. A combined 1.6 million shares changed hands on the NSE and BSE.

 

Investor Ashish Kacholia owned 2.19 million shares or 2.14 per cent stake in BFIL at the end of June 2024 quarter, according to shareholding pattern disclosed by the company.

BFIL is engaged in the manufacturing of fully finished and semi-finished crankshafts and forged components. It has the capacity to manufacture components conforming to both New Emission Regulations & the New Energy Vehicles. The customers include some of the renowned suppliers and manufacturers of light vehicles, agricultural equipment, power generation equipment, commercial vehicles, off-highway vehicles, ships, locomotives, and many others. The company also caters to the defence, oil & gas, railway, marine amongst other industries.

On July 16, 2024, BFIL announced a fund-raise of Rs 496.80 crore in a combination of preferential issue of equity shares and fully convertible warrants to strengthen its manufacturing capacity and capability to play its role in making India atmanirbhar or self-reliant in defence, railways and aerospace sector and turning the vision of Viksit Bharat into a reality.

The board of BFIL have approved an issue of 4.5 million equity shares of face value of Rs 10 each at a premium price of Rs 350 per equity share aggregating up to Rs 162 crore by way of preferential issue to the non promoter public category investors. The board also approved an issue of 6.3 million fully convertible warrants to the non-promoter public category investors and 3.0 million fully convertible warrants to the promoter category at an issue price of Rs 360 per warrant.

BFIL will majorly deploy a majority of the funds to undertake special R&D initiatives to further enhance the special engineering capability in the field of defence and aerospace components. The company will further add a new capability in the form of a Direct Drive Screw Press Line capable of producing aerospace and high precision components and SPM line for defence production. The product mix includes an extensive large portfolio covering railways, defence and aerospace industries.

BFIL said it is actively engaging with a number of companies globally for Transfer of Technology (ToT) and contract manufacturing agreements especially in the space of defence, railways and aerospace.

Meanwhile, BFIL had recorded strong growth in the fiscal 2024 (FY24) of 71 per cent over fiscal 2023 mainly driven by ramp up of enhanced capacity and continued product additions.

While the volume sales improved due to the better utilization of the manufacturing capacities, realizations also improved on account of higher sales of heavy products. With the steady order flow from the existing customers and continuous addition of new customers the scale of operations are expected to sustain and grow over the medium term, CRISIL Ratings said.

Meanwhile, the board of directors of the BFIL are scheduled to meet today i.e. July 30, 2024 to consider and approve financial results for the first quarter ended June 30, 2024 (Q1FY25).