Rs 2,198 Crore Order Book & DIIs Bought 15 Lakh Shares: Multibagger Penny Stock Under Rs 10 In Focus On Credit Rating Update

The stock is up by 22 per cent from its 52-week low of Rs 7.80 per share and has given multibagger returns of over 1,000 per cent in 5 years.

On Friday, shares of Salasar Techno Engineering Ltd surged 0.75 per cent to an intraday high of Rs 9.49 per share from its previous closing of Rs 9.42 per share. The stock’s 52-week high is Rs 23.27 per share and its 52-week low is Rs 7.80 per share. 

Established in 2006, Salasar Techno Engineering Limited (STEL) is a leading provider of customised steel infrastructure solutions in India. They offer a comprehensive range of services, including engineering, design, fabrication, galvanisation and installation. STEL's product portfolio includes various towers (telecom, power transmission, lighting, etc.), substations, solar structures, railway electrification components, bridges and custom steel structures. Moreover, they act as an EPC contractor, managing complete projects for rural electrification, power lines and solar plants. As of December 31, 2024, STEL has a strong order book of Rs 2,198 crore. 

According to Quarterly Results (Q3FY25), the net sales increased by 33.3 per cent to Rs 375.18 crore and net profit increased by 23.3 per cent to Rs 11.95 crore compared to Q3FY24 while in its nine-month results (9MFY25), the net sales increased by 13 per cent to Rs 950.67 crore and net profit decreased by 11 per cent to Rs 32.11 crore compared to 9MFY24. In FY24, the company reported net sales of Rs 1,208.43 crore and net profit of Rs 52.95 crore.

Salasar Techno Engineering Limited has revised its credit ratings by Infomerics Valuation and Ratings Pvt Ltd. The long-term bank facilities, amounting to Rs 680.45 crore, have been downgraded from 'IVR A/Positive' to 'IVR A/RWDI' (IVR A with Rating Watch with Developing Implication). Similarly, the short-term bank facilities, totalling Rs 18.00 crore, have been revised from 'IVR A1' to 'IVR A1/RWDI' (IVR A One with Rating Watch with Developing Implication). This change, affecting a total of ₹698.45 crore in bank loan facilities, comes after considering the company's performance in FY2024 and the first nine months of FY25.

Infomerics has placed these ratings on 'Rating Watch with Developing Implications'. While the 'IVR A' rating indicates an adequate degree of safety for long-term obligations and 'IVR A1' signifies an extreme degree of safety for short-term obligations, the 'RWDI' status suggests potential future changes based on evolving factors. The revised ratings are typically valid for one year from the initial communication date of September 5, 2024, and Infomerics reserves the right to conduct surveillance reviews at least once a year. Salasar Techno Engineering is obligated to provide regular financial and operational data to Infomerics for ongoing monitoring of these ratings.

Additionally, the Board of Salasar Techno Engineering Limited approved the amalgamation of its wholly-owned subsidiary, EMC Limited, under the Companies Act, aiming for operational benefits and cost reduction; EMC's financials as of December 31, 2024, included a paid-up share capital of Rs 7,800 lakh, reserves & surplus of Rs 5,376.04 lakh, total income of Rs 1,471.08 lakh, and a loss after tax of Rs 774.89 lakh, while Salasar's showed a paid-up share capital of Rs 17,267.70 lakh, reserves & surplus of Rs 53,959.24 lakh, total income of Rs 94,494.02 lakh, and a profit after tax of Rs 3,139.91 lakh; this merger, requiring regulatory and NCLT approval, involves no new share issuance and seeks to create a stronger combined entity.

In December 2024, DIIs took a fresh entry and bought 15,00,000 shares or 0.09 per cent stake. The stock is up by 22 per cent from its 52-week low of Rs 7.80 per share and has given multibagger returns of over 1,000 per cent in 5 years. Investors should keep an eye on this small-cap stock.

Disclaimer: The article is for informational purposes only and not investment advice.