This SME stock has zoomed nearly 580% over its issue price within 4 months

Afcom Holdings shares were locked in upper circuit for the second straight day, up 5% at Rs 732.65 on the BSE in Tuesday's intra-day trade

Shares of Afcom Holdings were locked in upper circuit for the second straight day, up 5 per cent at Rs 732.65 on the BSE in Tuesday’s intra-day trade. In 11 trading days, the stock of the logistics solutions provider has surged 68 per cent from the level of Rs 435 on November 14.

 

Currently, the company's stock is trading nearly seven times, or 578 per cent, higher against its issue price of Rs 108 per share. Afcom Holdings had made a robust market debut on August 9, in the BSE SME segment, with the company’s shares getting listed with a 99 per cent premium over its issue price, at Rs 215.45 per share.

 

The logistics solutions provider operates on an airport-to-airport basis, through General Sales and Service Agents (GSSAs) in India, Hong Kong, Singapore, Thailand, Japan, South Korea, China and Taiwan. The company works closely with the leading freight forwarders, both in India as well as in the ASEAN region, including countries such as Singapore, Indonesia and Brunei, among others.

 

The company has signed an agreement with Taylor Logistics Private Limited (a part of the TTK Group) to represent the airline in India. Apart from that, it has also signed up as a GSSA for the Air Logistics Group (a part of World Freight Company) to represent them in far-eastern countries.

 

According to Afcom Holding’s investor presentation, India's air freight market was pegged at $13.08 billion in 2023; and it is expected to reach $17.22 billion by 2028, growing at a compound annual growth rate (CAGR) of 5.65 per cent.

 

Since the interventions and measures envisaged by the government can increase efficiency and remove redundancies in the air cargo supply chain, India has the potential to become a vital player in the global air freight market. Increased exports of heavy industry components, pharma, and perishables from India is creating a robust demand for the air cargo sector and thereby resulting in great revenue generation, the company said.

 

Meanwhile, for the first half (April to September) of the financial year 2024-25 (H1FY25), Afcom Holdings had reported a healthy 54.64 per cent year-on-year (YoY) growth in profit after tax of Rs 18.86 crore. Revenues grew 25 per cent YoY at Rs 88.76 crore. Earnings before interest, tax, depreciation and amortisation (Eitda) rose 65 per cent YoY at Rs 27.49 crore, while margins improved 711 bps at 30.47 per cent.

 

With regards to clarification on the significant increase in the traded volume of equity shares belonging to Afcom Holdings in the recent past, the company said that all material information that has an impact on the operations / performance of the company and price-sensitive information has been shared.

 

“We further inform you that there has not been an occurrence of any material event as defined under Regulation 30 of the SEBI Regulations, 2015 which might have influenced the operations, and performance or have impacted the market price of the shares,” Afcom Holdings said on November 28.