This smallcap stock has zoomed 30% in 2 days on heavy volumes

D-Link (India)'s board on Saturday recommended a dividend of Rs 8 per equity share and a special dividend of Rs 5 per equity share totalling to Rs 13 per equity share for FY24.

Shares of D-Link (India) hit a record high of Rs 404.35, as they surged 19 per cent on the BSE in Monday’s intra-day trade amid heavy volumes after the company announced dividend of Rs 13 per share, including a special dividend of Rs 5 per share. In past two trading days, the stock of smallcap networking products provider company has zoomed 30 per cent. It surpassed its previous high of Rs 364.95 touched on September 5, 2023.

At 02:34 pm; D-Link (India) was quoting 18 per cent higher at Rs 401, as compared to 0.16 per cent rise in the S&P BSE Sensex. The average trading volumes at the counter jumped over 10-fold, with a combined 8.04 million equity shares representing 22.64 per cent of total equity of D-Link (India) changing hands on the NSE and BSE.

D-Link (India)’s board on Saturday recommended a dividend of Rs 8 per equity share and a special dividend of Rs 5 per equity share totalling to Rs 13 per equity share (face value of Rs 2 each) for the financial year ended March 31, 2024.

Meanwhile, the company posted 24.2 per cent year-on-year (YoY) growth in its consolidated profit at Rs 25.10 crore in March quarter (Q4FY24). Revenue grew 7.2 per cent YoY at Rs 333.86 crore.

D-Link (India) is a part of D-Link Corporation of Taiwan and is one of the largest networking companies in India. The company is engaged in the marketing and distribution of networking products in India and SAARC region. The Group is primarily engaged in the business of providing networking products and related services in relation to security features. The company will continue to benefit from its established market position and strong distribution network.

The Indian government is taking several initiatives to promote the growth of the IT hardware industry in the country. These initiatives include the Production-Linked Incentive (PLI) scheme, the National Manufacturing Policy, and the Startup India initiative. These initiatives are expected to provide a boost to the growth of the Indian IT hardware industry by attracting investments, creating jobs, and boosting exports.

According to IDC Report, the Ethernet Switch, Router, and WLAN markets are expected to grow in single digits in terms of compound annual growth rate (CAGR) for 2021–2026. Increased adoption of emerging technologies such as cloud, IoT, mobility, etc. would drive incremental revenues. IDC also expects large investments for 5G rollouts in the next couple of years.

The India router market is expected to grow at a healthy pace with a CAGR of 9.20 per cent from 2023 to 2028. The growth of the market is driven by a number of factors, including the increasing demand for high-speed internet, the growing number of connected devices, and the increasing adoption of smart homes and businesses, D-Link (India) said in its FY23 annual report.