Midcap and smallcap indices witnessed sustained buying by investors in the past one year despite multiple headwinds. Both the indices on the BSE have outperformed the benchmark index Sensex and notched up a gain of around 35% and 17%, respectively, in the past one year. In comparison, the BSE Sensex climbed 14% during this period.
One midcap stock that has given stellar return to its shareholders in the last one year is Jindal Worldwide, a flagship company of Ahmedabad-based Jindal Group. Formed in 1986, the company is engaged in manufacturing of denim fabric, yarn dyed shirting and bottom width, as well as exports of textile goods like bed sheets, pillow covers, cushion covers, etc.
Jindal Worldwide has returned 555% over past 10 months, with its shares jumping from 52-week low of ₹44 on April 19, 2021, to ₹292.55 in intraday trade. ₹1 lakh invested in this textile stock at ₹44 apiece would have now turned into more than ₹6.6 lakh.
However, investors must exercise due diligence before investing in this stock as it has been placed under long term additional surveillance measure (ASM) stage 1 category on the BSE. The market regulator SEBI imposes ASM framework from time to time to enhance market integrity and safeguard interest of investors. It may be also noted that the shortlisting of securities under ASM is purely on account of market surveillance and it is not be construed as an adverse action against the concerned company.
Stock performance boosted by robust earnings
The rally in Jindal Worldwide shares was in line with its financial performance. The textile company reported a net profit of ₹31.17 crore during December quarter of the current fiscal, compared with ₹22.21 crore in the same period last year. The total income grew to ₹693.21 crore in Q3FY22, from ₹628.60 crore in the corresponding period prior year.
In the first half of the current fiscal, it reported total income of ₹1,159.48 crore as compared to ₹470.35 crore during the 6-months period ended September 30, 2020. The profit stood at ₹43.89 crore in H1 FY22, as against ₹2.70 crores in the same period last year.
For the financial year ended March 31, 2021, the company posted net loss of ₹5.02 crore as against loss of ₹16.20 crores in the previous fiscal. The total income also dropped to ₹30.21 crore as compared to ₹34.42 crore during the 12 months period ended March 31, 2020.
This stock surged 380% in 6 months
With a market capitalisation of ₹5,782 crore, the stock witnessed a solid rally of more than 380% over the last six months. The stock has gained 14% since the beginning of the calendar year 2022, while dropped 13% over the past one month.
Not just in the short-term period, the stock delivered 310% returns in 3 years, 960% in 5 years, and more than 1,900% over the past ten years.
In the last one week, Jindal Worldwide share price slipped more than 12%. On Tuesday, the stock opened higher and gained as much as 3.3% to hit an intraday high of ₹292.65 on the BSE, in an otherwise weak broader market. In contrast, the BSE was trading 900 points, or 1.56%, lower at 56,782.
The stock was trading higher than 50-day, 100-day, and 200-day moving averages, but lower than 5-day and 20-day averages. Technically, the stock turned ‘bullish’ from ‘mildly bullish’ on September 6, 2021, at ₹75.10 apiece.