The shares of this smallcap company jumped around 3 percent in Friday’s trading session after reporting an increase in net profits by 123 percent YoY. The stock has delivered more than 60 percent return to its shareholders in just six months.
Price Movement:
With a market capitalization of Rs. 2,429 crores, the shares of Cosmo First Ltd (NS:CSFL) started Friday’s trading session on a higher note at Rs. 978 compared to its previous close of Rs. 908.45.
During the trading session, the shares hit a high of Rs. 986.65, gaining around 3 percent, also recorded as the company’s fresh 52-week high and are currently trading at Rs. 932 apiece.
Is Cosmo First Ltd a buy or sell? What is its Fair Value? What are the company's health parameters? What are the positive and negative factors driving the company -- ProTips? Know all the answers on the company's overview page here.
What Happened:
Such a positive movement in the share price was observed after the company announced its Q1FY25 results. Quarterly, the revenue jumped by around 8 percent from Rs. 641.31 crores during the March quarter to Rs. 689.67 crores in the June quarter. In addition, the net profits zoomed by 101 percent from Rs. 15.38 crores to Rs. 30.95 crores during the same period.
Comparing the same metrics on a YoY basis, the revenue jumped by around 5 percent from Rs. 657.66 crores during Q1FY24 to Rs. 689.67 crores in Q1FY25. On the other hand, the net profits magnified by 123 percent from Rs. 13.9 crores to Rs. 30.95 crores during the same timeframe.
The EBITDA for Q1FY25 was Rs 84 crore, an increase from Rs 55 crore in Q1FY24 and Rs 67 crore in Q4FY24. The EBITDA margin stands at 12.2 percent in Q1FY25, up from 8.4 percent in Q1FY24 and 10.5 percent in Q4FY24.
According to the company’s filing, the increase in EBITDA is driven by higher speciality sales and improved margins in domestic BOPP films due to increased demand. Speciality sales accounted for 69 percent of total volume in Q1FY25, up from 64 percent in FY24.
Moreover, the company anticipates an increase in speciality film sales and expects domestic margins to remain at more robust levels in FY25.
Management Commentary:
Commenting on the company’s performance Mr Pankaj Poddar, Group CEO, of Cosmo First Ltd said “The Company’s focus remains on specialty film business and cost rationalization opportunities. Rigid packaging vertical launched in H2, FY24 is growing well with addition of Injection Moulding from Q1, FY25. We are focusing on consolidation in Zigly during the first two quarters before next level of growth.”
Important Financial Ratios:
In terms of key financial metrics, the company reported a Return on Equity (RoE) of 4.61 percent and a return on capital employed (RoCE) of 6.84 percent for the period spanning FY23-24. Additionally, during the same period, the net profit margin stood at 2.40 percent.
Shareholding Pattern:
According to the latest shareholding pattern, the Promoters hold 45.04 percent of the shares, FIIs own 3.23 percent, DIIs have 0.68 percent and Retail Investors hold the remaining 49.72 percent.
Company Profile:
Established in 1981, Cosmo Films Limited is engaged in speciality films for packaging, lamination and labelling applications. Its film offerings include biaxially oriented polypropylene (BOPP) films, cast polypropylene (CPP) films and soon-to-be-offered biaxially oriented polyethene terephthalate (BOPET) films.
Written By Vaibhav Patil
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