155% YTD Return: Small Cap Stock Below Rs 100 In Focus After This Update

On Tuesday, shares of railway company MIC Electronics Ltd locked in a 5 per cent upper circuit limit to an intraday high of Rs 86.80 per share from its previous closing of Rs 82.56 per share. The stock's 52-week high is Rs 114.79 and its 52-week low is Rs 33. The company has a market cap of over Rs 2,090 crore with multibagger returns of around 380 per cent in 2 years and 155% YTD or so far in 2024.

Since the firm received permission from the CCA (capacity cum capability assessment) for its GPS location-based Public Address & Passenger Information System (PAPIS), MIC Electronics Ltd., a small-cap company in the capital goods sector with a share price below Rs 100, would be the focus of the next sessions.

"MIC Electronics Limited ("the Company") wishes to inform you that the Competent Authority had approved the capacity cum capability assessment (CCA) of the company for item ID: 2400064 GPS Location based Public Address & Passenger Information System (PAPIS) and LED Destination Boards in AC and Non -AC ICF & LHB Coaches. Spec: RDSO/CG-18001 (Rev.2), against registration request ID 24384 dated 07/06/2024," said the company in a stock exchange filing.

The company completed its Qualified Institutional Placement (or "QIP") of 1,95,65,217 equity shares with a face value of Rs 2/-each for cash at a price of Rs 48.30/-each, including a share premium of Rs 46.30/-each equity share, totalling Rs 90 Cr during the quarter that ended on September 30, 2024. The issue was made in compliance with the 2018 amendments to the SEBI (Issue of Capital and Disclosure Requirements) Regulations.

The expected cost of Rs 2.50 Cr revealed in the final offer document is higher than the actual cost of Rs 1.93 Cr borne by the firm for offer-related expenditures. As a result, the Rs 0.57 Cr in surplus proceeds from offer expenditures were utilised for working capital during the quarter that ended on September 30, 2024. As a result, the net proceeds are now Rs 88.07 Cr instead of Rs 87.5 Cr.

The company's September 2024 quarter net sales of Rs 11.20 crore showed a 57.75% growth over the September 2023 quarter's net sales of Rs 7.10 crore. In Q2FY25, the company's net profit was Rs. 2.11 crore, a 74.63% drop from Rs. 8.30 crore in Q2FY24. EBITDA grew by 55.24% from Rs. 2.48 crore in Q2FY24 to Rs. 3.85 crore in Q2FY25.
Last month, on November 8, 2024, MIC Electronics subscribed for 50,000 (fifty thousand) equity shares at a price of Rs. 10 apiece, forming its wholly-owned subsidiary MICK Digital India Limited (WOS) in the company's paid-up share capital. 100% of the paid-up share capital was paid in cash as the company purchased 50,000 equity shares at a face value of Rs. 10 apiece, totalling Rs. 5,00,000.

Anand Rathi's Jigar Shantilal Patel has issued a buy recommendation on MIC Electronics shares, recommending that investors purchase or accumulate the stock within the 81-83 range with a one-month target price of Rs 90 and a daily closing stop-loss of Rs 77.5.