Nilkamal hits over 2-year high as promoters increase stake via open market

Shares of Nilkamal hit an over two-year high of Rs 2,071.60, up 6 per cent, on the BSE in intra-day trade on Monday as promoters increased their stake in the company via open market transactions.

The stock of plastic products company surpassed its previous high of Rs 1,985 touched on February 12, 2021. It was trading at its highest level since August 2018. It had hit a record high of Rs 2,275 on May 11, 2017. In the past three years, the stock has underperformed the market by gaining 27 per cent as against a 50 per cent rally in the S&P BSE Sensex.

According to the disclosure made by Nilkamal to stock exchanges, the company’s promoters Hiten V Parikh, Nayan S Parikh and Manish V Parikh have collectively purchased 23,077 equity shares of the company worth Rs 4.27 crore between March 8 and March 16.

The names of the sellers were not ascertained immediately. As on December 31, 2020, the total promoters holding in the company stood at 64.33 per cent, the shareholding pattern data shows.

Nilkamal is engaged in the manufacturing business of furniture and material handling products with diversified product profile across various segments along with a diversified customer base including household customers, industrial customers and retail buyers. It also has its presence in the retail business of lifestyle furniture, furnishings and accessories under its brand '@home'.

For the October-December quarter (Q3FY21), Nilkamal recorded a volume growth of 11 per cent and achieved net sales of Rs 567 crore, up 8 per cent over the previous year quarter. Profit after tax (PAT) jumped 88 per cent year-on-year (YoY) at Rs 51.92 crore on the back of strong operational performance. Ebitda (earnings before interest, taxes, depreciation, and amortization) margin improved by 475 basis points (bps) to 17.26 per cent from 12.51 per cent in Q3FY20.

The company said the availability of quality products at reasonable prices and supply assurance along with seamless service shall continue to play a vital role in its growth. This is backed by continuous investment in technology for improved performance in supply chain and service standards.

The company's manufacturing facility of the racking and shelving material handling storage system at Sinnar has stabilised and reached the capacity utilisation of more than 75 per cent during the December quarter, it said.

At 10:51 am, Nilkamal was trading 4 per cent higher at Rs 2,025 on the BSE as against a 0.68 per cent decline in the S&P BSE Sensex. A combined 110,000 equity shares have changed hands on the counter on the NSE and BSE so far.