Shares of Rallis India Limited – a part of the Tata Group – are upbeat today even as the company reported muted numbers for the quarter ended June. Tata Chemicals had acquired a majority stake in the agri-chemicals company in 2009.
The Investment: A decade ago, on July 18, 2013, if your mom had invested ₹10,000 in Rallis India, she could have purchased around 63 shares at the then closing price of ₹156.4 per share. Fast forward to today, those shares would be valued at around ₹13,419, given the current market price of ₹213 per share. This translates to a return of over 34% on the initial investment much below the returns of other Tata stocks, which have given multifold returns to investors over the same period.
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Background: The company reported a 9% year-over-year decrease in revenue from operations settling at ₹782 crore. Profits for the April-June period were ₹63 crore, a 6% decrease from the ₹67 crore profits it reported during the same period last year. The company’s EBITDA for the quarter was ₹110 crore, with an EBITDA margin of 14.1%. The earnings per share for the quarter stood at ₹3.26.
Rallis India’s CEO, Sanjiv Lal, attributed the subdued results to high market inventories, significant price drops, and a delay in the onset of the monsoon. He also expressed a cautious outlook for the international market's demand recovery in the second half of the year, as the inventory situation is expected to improve.
Price Action: Rallis India's share price experienced a slight uptick of 0.97%, trading at ₹213.50 in the afternoon hours of trading on Monday.
Disclaimer: Benzinga India doesn’t give financial advice. The above article is for educational purposes alone.
Editor’s Note: Artificial intelligence was used as a secondary aid in the writing of this story.
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