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Land allotment in Andhra boosts PCBL shares by 4%

Stocks
2 min Read Nov 28, 2024
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PCBL shares surged 4.41% to ₹449.75 on the BSE during Thursday’s intraday trade. The rise came after the company received approval from the Andhra Pradesh government for 116.62 acres of land at the Naidupeta MPSEZ. This milestone has positioned PCBL as a strong contender for those looking to invest in stocks.

Major investment for advanced manufacturing plant

PCBL plans to establish a facility at the Naidupeta MPSEZ to produce new black rubber and value-added chemicals. The project involves an investment of ₹3,718 crore and is expected to generate 200 direct jobs. The company acquired the land at ₹1,948 per square metre, and approval was granted on the condition that specific implementation timelines be met.

India’s largest carbon black producer diversifies operations

As India’s largest Carbon Black producer, PCBL manufactures essential materials for automotive tyres using Carbon Black Feedstock (CBFS) and tar oil. The company also produces speciality chemicals and generates electricity for internal use and surplus sale, showcasing a diversified portfolio for those looking to invest in stocks.

Financial performance sees strong growth

PCBL reported an 8.1% increase in net profit for Q2FY25, rising to ₹118 crore from ₹109 crore in the same quarter last year. Revenue surged by 59% to ₹2,141 crore compared to ₹1,347 crore in the corresponding period of the previous fiscal.

EBITDA, or the earnings before interest, tax, depreciation, and amortisation, grew by 70% to ₹358.2 crore, with margins improving to 16.7% from 15.6% the previous year. These figures highlight strong operational efficiency, encouraging many to invest in this company's stocks.

Market performance and valuation

Year-to-date, PCBL shares have gained 67%, outperforming the BSE Sensex, which rose 11%. Over the past year, PCBL’s stock also delivered a 67% return compared to the Sensex’s 21%. The company has a market capitalisation of ₹17,788.75 crore and trades at a price-to-earnings ratio of 30.57, with earnings per share of ₹13.99.

At 10:50 AM, PCBL shares were trading 0.64% lower at ₹428, while the BSE Sensex fell 0.88% to 79,527.44.

Key takeaways

  1. PCBL secures land for ₹3,718 crore manufacturing project in Andhra Pradesh.

  2. Q2FY25 net profit rose by 8.1%, with a 59% revenue increase.

  3. Shares gained 67% in the last year, outperforming the Sensex.

  4. Strong operational growth reinforces PCBL as a choice to invest in stocks.