This Jhunjhunwala stock reduced Rs 1 lakh to Rs 16,000 since January 2018, here's why

Prakash Industries share held by ace investor Rakesh Jhunjhunwala has reduced investor wealth by 83% since January 2018. The share which closed at Rs 242.30 on January 19, 2018 trades at Rs 39.75 on NSE today. An investment of Rs 1 lakh in Prakash Industries share on January 19, 2018  would have shrunk to Rs 16,405 today, translating into wealth erosion of 83.59% during the period.  

During the same period, Sensex gained 6.91% from 35,511 on January 19, 2018 to 37,968 today. Market cap of the firm stood at Rs 683.34 crore today.

In June quarter, Jhunjhunwala held 1.46% stake or 25 lakh shares in the firm.

However, Prakash Industries share price has gained 3.38% in one week and risen 8.86% in three sessions. In a month, the share has lost 15.5%. Prakash Industries share price hit a 52-week low of Rs 18.55 on March 24, 2020 and 52-week high of Rs 64.80 on January 3, 2020.

Weak financial performance of the firm coupled with the market crash in March has led to the fall in stock since January 2018.

Net sales for March 2018 fiscal stood at Rs 3,006 crore. In March 2020 fiscal, sales were down to Rs 2973 crore.  Net profit fell to Rs 118 crore in March quarter of last fiscal against profit of Rs 386.25 crore for fiscal ended March 2018.

This stock held by Rakesh Jhunjhunwala tripled in six months

Earnings per share (EPS)  fell to Rs 6.90 in last fiscal against Rs 24.62 for fiscal ended March 2018.

For quarter ended June 2020, the firm reported a 91% fall in net profit to Rs 3.19 crore against Rs 37 crore profit in the same quarter of corresponding fiscal.

Sales too fell 36% to Rs Rs 529 crore in Q1 against Rs 825 crore for quarter ended June 2019.

Rakesh Jhunjhunwala earned Rs 2.71 crore per day with this stock for 100 sessions

The stock which hit 52-week low of Rs 18.55 on March 24, 2020 dragged by the market crash has gained 114% till date.

Prakash Industries is engaged in the production of ferro alloys, MS TMT/MS coil and allied products, HB Wire Rod, and PVC Pipe and Sockets. The company's segments include power, steel and PVC Pipe.

Jhunjhunwala earned Rs 5.6 crore per day with this stock for 111 sessions

Its product range includes Sponge Iron, Power, Wire Rod, thermo mechanically treated (TMT) bars and Rigid polyvinyl chloride (PVC) Pipes. The company's plants are located in Champa, District Janjgir-Champa, and Raipur in Chhattisgarh.