Rs 40 to Rs 1,166 in five years: Stock split, special dividend for this multibagger firm in Q1 earnings

Shares of Godawari Power & Ispat have delivered over 2,800% returns to investors in the last five years. The multibagger stock of the steel producing major, which closed at Rs 39.8 on August 7, 2021 rose to Rs 1,166 on August 8, 2024 current session. Rs 1 lakh invested in the stock five years ago would have turned into Rs 28 lakh today. In comparison, Sensex has risen 45.86% in three years. In the current session, Godawari Power stock rose 1.5% to Rs 1,166 on BSE. Earlier, the stock opened higher at Rs 1158.65 against the previous close of Rs 1148.70 on BSE.

The steel and power manufacturer’s stock has gained 104% in a year and risen 304% in two years. In the current session, total 0.40 lakh shares of the firm changed hands amounting to a turnover of Rs 4.60 crore in the current session. Market cap of the firm stood at Rs 15,413 crore. The stock hit a 52-week low of Rs 550.95 on September 12, 2023 and scaled a record high of Rs 1,166 in today’s trade.

Godawari Power shares have a beta of 0.7, indicating low volatility in a year. 

Technicals 

In terms of technicals, the relative strength index (RSI) of the stock stands at 59.4, signaling it's trading neither in the overbought nor in the oversold zone. Godawari Power shares are trading higher than the 5 day, 20 day, 50 day, 100 day and 200 day moving averages.  

Q1 earnings

In Q1 of the current fiscal, Godawari Power reported a 24 per cent rise in consolidated net profit at Rs 286.89 crore for the June quarter on a fall in expenses. Total income climbed to Rs 1,372.42 crore in Q1 from Rs 1,344.37 crore in the Ccorresponding quarter a year ago.

Expenses declined to Rs 987.30 crore in the June quarter from Rs 1,063.00 crore in the first quarter of the last fiscal.

The board cleared a proposal for payment of a special dividend of Rs 1.25 per equity share of Rs 5 each on the occasion of 25th anniversary of the company. The payment will be made on or after August 28, 2024.

The board also cleared a proposal for sub-division of equity share with face value of Rs 5 each into 5 equity shares of Re 1 each, subject to approval of the shareholders.

Stock outlook 

Rupak De, Senior Technical Analyst at LKP Securities has a buy call on the stock with a price target of Rs 1,200-1,230. Stop loss can be fixed at Rs 1,100.

"Godawari Power has given a consolidation breakout on the daily chart. Additionally, the stock found support around the 50 EMA prior to the current rally. The RSI is in a bullish crossover and rising. On the higher end, the stock might move towards Rs 1,230 in the near term, with support placed at Rs 1,100," said De

About the Company    

Godawari Power is a steel company, which operates through two segments: Steel and Electricity. Its geographic segments include domestic market and export market. The company is engaged in iron and steel industry, power sector and mining sector.