Elcid Investments, whose stock price rose a whopping 66,92,535% on October 29 to Rs 2,36,250, could still be undervalued, suggest its fundamentals.
Elcid Investments surpassed MRF Ltd to become country's most expensive stock after BSE conducted an auction for price discovery of holding companies.
The smallcap stock created history on Dalal Street as its share price soared from Rs 3.53 to an astounding Rs 2,36,250 in one day, a jump of a mind-boggling 66,92,535%. Meanwhile, on October 30, MRF shares on BSE were trading flat at Rs 1.22 lakh apiece.
The highest traded value of Elcid was Rs 4.58 lakh, but price discovered was at Rs 2.25 lakh.
What more, it is still significantly below the book value. As per Screener, the book value stands at Rs 5.84 lakh.
Book value per share is a financial metric that measures a company's net asset value (NAV) per share. It's calculated by dividing a company's total equity by the number of outstanding shares.
The company's net profit in June quarter was at Rs 135.95 crore in June 2024, up 39.57% from Rs 97.41 crore in June 2023.
Net sales were at Rs 177.53 crore in June 2024, up 38.28% from Rs 128.38 crore in June 2023.
Elcid Investments is a registered NBFC under investment company category with RBI. The company currently doesn’t have any of its own operational business, but it has a lot of investments in other big companies like Asian Paints, etc.
The main source of earnings is the dividends from its holding companies. The company has over Rs 11,000 crore worth of investments and its market capitalisation in Rs 4,725 crore.
A June 2024 SEBI circular proposed a new mechanism to improve the price discovery of Investment Companies (ICs) and Investment Holding Companies (IHCs).
SEBI noticed that many ICs and IHCs are trading significantly below their book value.
To help improve liquidity, fair price discovery, and the overall investor interest in the stocks of such companies, SEBI introduced a framework for “special call auction with no price bands” for these stocks.
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