Smallcap, iron & steel products maker, Surya Roshni has announced double rewards for investors. The company will deliver 50% interim dividend, followed by a 1:1 bonus issue to its investors. The stock price will be in focus next week, as the company records a double-digit decline in its Q2FY25 earnings.
Surya Roshni Share Price:
After market hours of November 14, Surya Roshni stock ended at Rs 611.75 apiece, down by 6.5% on BSE. Its market cap stood at Rs 6,656.94 crore. The stock's price-to-equity ratio is at 20.65x, while return on equity is around 14.90%.
Surya Roshni Bonus Issue:
The company received approval for a bonus issue of 1: 1 i.e. 1 (one) Bonus Equity Share of face value of { 5/-each fully paid up for every 1 (one) existing equity share of face value of { 5/-each fully paid up, to the eligible members of the Company as on the record date, by the capitalisation of Securities Premium Account and/ general reserve and/ or Captital Redemption Reserve Account and/ or retained earnings, subject to the approval of the Shareholders of the Company through postal ballot.
Up to Rs 54,40,89,740/-would be capitalized for implementing the bonus issue. The company plans to complete its bonus issue action within two months from the date of approval of the Board i.e. on or before Monday, January 13, 2025.
Surya Roshni Dividend:
Apart from the bonus issue, the company declared an interim dividend @50% on the paid-up value of equity shares i.e. Rs.2.50 per Equity Share of Rs. 5/- each of the Company on Pre-Bonus paid-up share capital.
The interim dividend shall be paid within 30 days from the date of declaration i.e. on or before 13th December 2024, to the equity shareholders of the Company, whose names appear on the Register of Members of the Company or in the records of the Depositories as beneficial owners of the shares as on Friday the 29th November, 2024, which is the Record Date fixed for the purpose.
Surya Roshni Results:
The company posted PAT of Rs 34 crore, down by 55% YoY, while revenue dipped by 20% to Rs 1,529 crore. Also, EBITDA was at Rs 83 crore, lower by 40% YoY. In the quarter, the Steel Pipes business experienced a sharp decline in HR steel prices. Dampened demand resulted in lower revenues. However, operational efficiencies helped mitigate losses arising due to price erosion.
Also, in the quarter, in the Lighting & Consumer Durables segment, price erosion in LED products continued. However, better cost management and product mix resulted in better performance.
Looking ahead, the Company's Managing Director, Mr Raju Bista, said, "We are optimistic about the upcoming quarters, expecting improved performance in professional lighting and consumer appliances on account of demand due to the festive season. We continue to aim for revenue growth close to 12% for FY25, with a cautiously optimistic outlook for EBITDA margin. Our expansion efforts in consumer durables and increasing geographical presence in semi-urban markets are anticipated to further strengthen our market position and instil resilience against ongoing price pressures."
BUY/SELL Surya Roshni Stock:
As per Trendlyne data, the consensus recommendation from 2 analysts for Surya Roshni Ltd. is BUY. EPS is expected to grow by 30.0% in FY25. The average 1-year target price on Surya Roshni is Rs 661, hinting at a nearly 7% potential upside ahead.
Since its inception in 1973, Surya Roshni has transformed into an organization that has developed its Lighting & Consumer Durables business and built a stronghold in the Steel Pipes & Strips business. The company started with the manufacturing of steel tubes in 1973, it then diversified by foraying into Lighting in 1984, PVC pipes in 2010 and Consumer Durables like Fans and Home Appliances in 2014-15.
'Surya' Brand and 'Prakash Surya' have a strong presence of more than four decades in India. It enjoys a strong Pan India presence with an extensive dealer network in both of its businesses i.e. Steel Pipes & Strips and Lighting & Consumer Durables.
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