Monetary policy tightening, geo-political tensions, and economic uncertainties have soured investors’ appetite for riskier assets such as equities, commodities, and currencies. Despite high volatility in the equity market, some stocks have managed to grab investors’ attention. Ambar Protein Industries, a little-known fast-moving consumer goods (FMCG) company, is one such stock that has delivered astonishing returns to its shareholders this year.
The share price of the Ahmedabad-based company, which manufactures and sells edible oil, has been hitting the upper circuit for the last 58 sessions and has risen around 1,500% during the period, from ₹45 on June 23, to ₹730 on September 23. On Friday, the microcap share was locked in the 5% upper circuit limit at ₹730, while market capitalisation surged to ₹419.75 crore.
In the last six months, the stock has delivered 23 times returns to its investors, from ₹29.65 on March 28 to a fresh all-time high of ₹730 in intraday today. If an investor had invested ₹1 lakh in this multibagger stock six-month ago, it would now have grown to ₹24.62 lakh.
In comparison, the sector heavyweight Patanjali Foods and Adani Wilmar, the country’s largest edible oil companies, have risen 38% and 98%, respectively, in the past six months.
Ambar Protein shares trade higher than 5-day, 20-day, 50-day, 100-day, and 200-day moving averages. It has surged 28% in a week, 192% in a month and more than 3,300% in the calendar year 2022. In the last one year, the stock has given a massive return of nearly 5,500%.
The stock belongs to ‘XT’ group, which means it is only listed on BSE and is settled on a trade-to-trade basis. Such stocks have small market capitalisation and are riskier than largecap counters but offer higher growth potential.
Formed in 1992, Ambar Protein Industries is a manufacturer and seller of refined cottonseed, groundnut oil, refined sunflower oil, maize oil, as well as soybean oil. It provides edible oil under the brand name Ankur to consumers in Gujarat. Its product portfolio includes Ankur Refined Cottonseed Oil, Ankur Refined Sunflower Oil, Ankur Refined Soybean Oil and Ankur Refined Corn Oil. The company's refining plant is situated at Chandgodar, Dist. Ahmedabad with a capacity of 110 tons of refined oil per day.
The near-term outlook for the edible oil companies has been stable due to fall in global prices and uptick in domestic demand due to the upcoming festive season. Indian edible oil consumption is 24 MT, which includes 11 MT of edible oil produced domestically from soybean, rapeseed, mustard, groundnut, sunflower, safflower & nigar seeds. Further, palm oil, coconut, rice bran, cotton seed & tree borne oilseeds are also some of the secondary sources of edible oil production in India.
As per the latest shareholding pattern available on the BSE, the promoter owns 74.97% shares in the company, while retail investors hold the remaining 25% stake in the company.
Ambar Protein, in its FY22 annual report, said it reported a net profit of ₹3.45 crore in the financial year ended March 2021, compared to ₹1.25 crore in the previous fiscal. Total income stood at ₹313.76 crore versus ₹284.85 crore in FY20. It had refined 21,239.96 MT of cotton seed oil in its refinery in FY21, as against 27,457.91 MT in FY20. The company also purchased & packed 2,134.92 MT refined groundnut oil, refined sunflower, refined maize oil, mustard oil and soybean oil for resale during the period under review. The company did not recommend any dividend for the FY21.
For the April-June quarter of 2022, the company reported net profit of ₹1.34 crore and the total revenue of ₹84.48 crore, as against profit of ₹0.7 crore and revenue of ₹82.07 crore in the corresponding period last year.