Tata Steel's Penny Stock Has Return On Equity (RoE) At 122% Despite Hitting 2% Lower Circuit; YTD Gains 136%

Tata Steel-backed penny stock TRF touched a 2% lower circuit on BSE during the trade of June 20. This comes after the stock clocked 2% upper circuit in the previous day. Currently, the stock is even below the Rs 600 mark. Despite the latest fall, TRF has a return of equity (RoE) one of the highest on BSE and NSE, even higher than its parent Tata Steel. TRF is among the top winners of 2024, with a low PE ratio.

After the market hours, TRF's share price is at Rs 595.75 apiece, which is its 2% lower circuit on BSE. Its market cap is currently at Rs 655.63 crore. TRF's weekly performance is lower by 5%.

As per the exchange's data, TRF still has a RoE of 122.08% as of June 20, 2024, with a PE ratio of 14.07x.

The earnings per share is at Rs 42.34. The price to book ratio is at 17.17x.

Among the fundamentals, as per Trendlyne data, TRF stock rose by 243.77% and outperformed its sector by 96.81% in the past year. However, its Price Earning Ratio is 18.95, lower than its sector PE ratio of 74.1. Moreover, in the last financial year, the RoE stood at 88.58%, more than 20% in the last financial year, indicating an efficient use of shareholder's capital to generate profit.

Also, in the March 2024 quarter, FIIs increased their holding in TRF to 0.78% from zero levels in the December 2023 quarter. Promoters and mutual funds holding remains unchanged at 34.12% in the Mar 2024 quarter. Tata Steel holds about 34.1% stake in the company.

In the case of technical, Trendlyne data revealed that TRF is trading above 5 out of 9 Oscillators in a bullish zone, while also above 6 out of 8 SMAs. Meanwhile, the RSI is 51.9 which is stable since RSI below 30 is considered oversold and above 70 overbought. MFI is also at 75.0, which indicates that the stock is overbought which implies there could be some pullbacks in TRF shares.

YTD, the stock zoomed by 136%. In a year, the stock is up by 241%. All-time gains are about 1,521.09%.

TRF stock has never carried a stock split. However the company delivered a bonus issue of 1:1 in July 2009. While TRF has paid 13 dividends since July 2001. The last time the company paid dividends however was in July 2012 to Rs 4 per share.

TRF Limited was incorporated on 20th November 1962 at Jamshedpur. Promoted by Tata Steel, TRF has over the years executed various electromechanical jobs for bulk material handling equipment.

With the building and development of competence and expertise in these areas, TRF is poised to become a key and valuable contributor in the capacity enhancement plan of Tata Steel Kalinganagar (Phase 2) and other Tata Steel projects and support services shortly.

For over five decades, TRF has been supplying value-added products and services and minimum cost of ownership to its esteemed customers, such as Tata Steel, Tata Power, National Thermal Power Corporation, Steel Authority of India, National Mineral Development Corporation, Bharat Heavy Electric Limited, Krishnapatnam Port, etc.