Infrastructure Stock Salasar Techno Hits Upper Circuit After 4:1 Bonus Share Allotment In 2024

Shares of Salasar Techno Engineering Limited (STEL) hit a 5 per cent upper circuit to Rs 19.38 per share from its previous closing of Rs 18.46 per share. FIIs bought a 3.27 per cent stake in the company in Q4FY24 and increased to 6.27 per cent compared to 3 per cent in Q3FY24.

The stock outperformed the sector by 4.41 per cent. The stock has been gaining for the last two days and has risen 5.27 per cent in returns in the period. It is trading higher than 5-day and 200-day moving averages but lower than 20-day, 50-day and 100-day moving averages.

STEL recently completed two significant transactions that are expected to bolster its presence in the engineering and infrastructure sectors. Firstly, STEL acquired EMC Limited, a company undergoing liquidation, through an e-auction for a total of Rs 178 crore. By integrating EMC's capabilities, STEL aims to broaden its service offerings and strengthen its market position. Secondly, STEL's Board of Directors approved the conversion of warrants held by Coeus Global Opportunities Fund into equity shares. This conversion translates to a Rs 35.1 crore investment in STEL and increases Coeus' ownership stake in the company to 1.88 per cent.

Recently, the company said that its consolidated PAT in Q4 increased by 13 per cent YoY to Rs 16.9 crore. The PAT in the corresponding quarter of the previous fiscal stood at Rs 14.7 crore. Income from operations in the reporting quarter came in at Rs 367.3 crore, up around 20 per cent YoY as compared to Rs 294.6 crore reported in the same three-month period a year ago. Revenue from EPC projects in the quarter under review grew by 32 per cent to Rs 174.9 crore from Rs 117.5 crore reported in the quarter ended March 31, 2023.

In February 2024, the company issued bonus shares in a 4:1 ratio, further enhancing shareholder value. This follows a similar bonus share issuance in 2023, also in a 4:1 ratio. Additionally, the company had previously split the face value of its shares from Rs 10 to Rs 1 in June 2022.

Incorporated in 2006, Salasar Techno Engineering is engaged in providing comprehensive steel fabrication and infrastructure construction services. The company offers end-to-end EPC services for electrification, power transmission lines, and solar power plants. Over the years, Salasar Techno has completed numerous large-scale projects for both private and public sector enterprises, particularly in the railway and power sectors. Its portfolio also includes the design and manufacture of telecom towers, monopoles, and other heavy steel structures.