4,895 per cent multibagger returns: Promoter sells 9.07 lakh shares, Reinvests Rs 350 Cr as interest-free loan to boost growth and reduce debt
The stock has given multibagger returns of 4,895 per cent from its 52-week low of Rs 11.02 per share.
On Thursday, shares of Godfrey Phillips India’s peer company, Elitecon International Ltd, hit a 5 per cent lower circuit to Rs 550.40 per share from its previous closing of Rs 579.35 per share. The stock’s 52-week high of Rs 629.55 per share and its 52-week low is Rs 11.02 per share.
Elitecon International Limited's promoter, Mr. Vipin Sharma, is divesting approximately 9.07 lakh equity shares through open market transactions. Crucially, the entire estimated proceeds of approximately Rs 350 crore from this sale are being fully reinvested back into the Company. This significant capital infusion, which includes an unsecured, interest-free loan of Rs 50 crore, is a strategic move aimed at bolstering Elitecon's working capital, supporting scalable growth initiatives, and facilitating uninterrupted execution of its strategic plans. This action underscores the promoters' unwavering commitment to the Company's long-term vision, financial strength, and operational resilience, while also reducing dependence on external borrowings and enhancing financial flexibility.
The transaction, though a promoter-level divestment, is explicitly stated to be strategic and long-term, not driven by personal gain. It reflects the promoters' dedication to meeting the Company's immediate funding needs and future priorities, even amidst less-than-optimal market conditions. Following this transaction, the promoters and promoter group will maintain a substantial 59.43 per cent stake in Elitecon International Limited, indicating continued financial and strategic alignment. Furthermore, the promoters intend to explore opportunities to further increase their shareholding in compliance with relevant regulations and strategic objectives.
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About the Company
Established in 1987, Elitecon International Ltd. (EIL) specialises in the manufacturing and trading of a diverse range of tobacco and allied products for both domestic and international markets. The company's product portfolio includes smoking mixtures, cigarettes, pouch khaini, zarda, flavoured molesis tobacco, yummy filter khaini, and other tobacco-based items. EIL has a notable international presence, operating in the UAE, Singapore, Hong Kong, and European countries like the UK, and plans to expand its offerings to include products such as chewing tobacco, snuff grinders, and match-related articles. The company also boasts its brands, including "Inhale" for cigarettes, "Al Noor" for sheesha, and "Gurh Gurh" for smoking mixtures.
According to consolidated Quarterly Results, the net sales increased by 232 per cent to Rs 313.16 crore and the net profit increased by 222 per cent to Rs 42.97 crore in Q4FY25 compared to Q4FY24. In its standalone annual results, the net sales increased by 424 per cent to Rs 297.51 crore and the net profit increased by 574 per cent to Rs 32.21 crore in FY25 compared to FY24. For the consolidated annual results (FY25), the company reported net sales of Rs 548.76 crore and net profit of Rs 69.65 crore.
The company has a market cap of Rs 8,798 crore and has delivered good profit growth of 243 per cent CAGR over the last 5 years. In FY25, FIIs bought a 22.81 per cent stake and increased their stake to 38.30 per cent compared to FY24. The stock has given multibagger returns of 4,895 per cent from its 52-week low of Rs 11.02 per share.
Disclaimer: The article is for informational purposes only and not investment advice.