Penny stock below Rs 20 hits upper circuit: Make in India optical fibre company rides anti-dumping wave!

Penny stock below Rs 20 hits upper circuit: Make in India optical fibre company rides anti-dumping wave!

Karan Dsij
/ Categories: Trending, Penny Stocks

A staggering multibagger gains of 147 per cent over the last three years, the company’s journey reads like a tale of triumph over adversity

In the enchanting world of stock markets, where every new day ushers in opportunities akin to the blank pages of an unwritten book, a quote by Paulo Coelho rings remarkably true: 'A new day is a blank page in the book of life. The pen is in your hand. Write a good story.' This adage seems tailor-made for the realm of optical fibre stocks, where a recent turn of events has transformed into a captivating tale of market dynamics and strategic decisions.

Like a masterful storyteller, the Directorate General of Trade Remedies (DGTR), a division of the Commerce Ministry of India, has penned an intriguing chapter for optical fibre companies. In a strategic maneuver to safeguard the domestic industry from the clutches of artificially cheap imports, they've imposed an anti-dumping duty on optical fibre imports from China, Korea, and Indonesia. This fairy tale-esque development has cast a ray of optimism upon the stocks associated with optical fibres.

The gazette notification, unveiled on August 3, conveyed a narrative of concern: these imports were not only disrupting the delicate balance of the domestic market but also causing 'injury to the domestic markets.' The antidote to this challenge manifested in the form of a resolute commitment - an anti-dumping duty with a five-year lifespan, poised to shield the domestic players from the adversities of unfair competition.

In this enthralling saga, one stock stands out like a protagonist on a daring journey. Aksh Optifibre Ltd, the stock is locked at an upper circuit limit of 20 per cent at Rs 12. A company woven into existence in March 1986 as a manufacturer of specialty cables, has evolved into a formidable contender in the optical fibre landscape. The company's evolution into manufacturing Optical Fibre Cables (OFCs) in 1994 and its subsequent foray into Optical Fiber (OF) production in 1995 showcase a narrative of transformation and adaptability.

A pivotal plot twist occurred in the year 2000 when AOL acquired the business of Fibre Reinforced Plastic Rods (FRP rods), a key raw material for OFCs. This acquisition not only bolstered their value chain but also fortified their strategic footing. Moreover, AOL's engagement in e-governance services and turnkey solutions for smart cities paints a portrait of diversification and innovation.

AOL's symphony of accomplishments crescendos into their outstanding performance in the stock market. With returns of 26 per cent and 44 per cent in the short term, and a staggering multibagger gains of 147 per cent over the last three years, the company’s journey reads like a tale of triumph over adversity. However, like any compelling narrative, there are challenges that test the protagonist's resolve. In Q1FY24, a 27 per cent dip in topline and a net loss of Rs 1.80 crore were recorded, adding an element of uncertainty to this captivating tale.

Amidst this unfolding narrative, a pressing question takes centre stage: Is this a defining moment for AOL, poised to be a game-changer in the long run? Or is it merely a heartwarming sentiment that might wane with time? The answer, much like the next chapter in an exhilarating story, lies in the unknown future. Only time will unveil whether AOL's journey will ascend to legendary status or recede into the annals of history. As the narrative unfolds, we stand as eager readers, waiting to see how this intriguing tale pans out.

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