From ₹20 to ₹123: This small-cap multibagger inventory surges over 500% in a yr. Do you personal?

Multibagger Inventory: Investing within the inventory market can yield substantial rewards when the proper shares are chosen, however it could additionally result in disappointing outcomes if investments are made unwisely. Happily, shareholders of Diamond Energy Infrastructure have causes to have fun, because the shares of this firm delivered phenomenal returns.

The inventory has been on a successful run lately, with a 516% achieve during the last yr, spiking from ₹19.90 to the present market worth of ₹122.60. Zooming out, the inventory has delivered stellar returns of 4,400% during the last 16 months.

Diamond Energy Infrastructure is small-cap inventory with a market capitalisation of ₹6,500 crore. The corporate is a number one producer of energy cables, together with LV, MV, EHV, and conductors. Its merchandise play a vital position in initiatives associated to energy era, electrical energy transmission and distribution, and numerous industrial functions. The corporate provides cables to authorities distribution corporations (discoms), non-public discoms, non-public EPC contractors, industrial shoppers, and export markets.

The corporate is poised to profit from the rising demand for renewable power applied sciences, resembling wind and solar energy, which require energy cables for transmission.

Furthermore, growing authorities investments in infrastructure growth initiatives, together with good cities, highways, and railways, are anticipated to additional drive demand. The rising adoption of electrical automobiles, which require charging infrastructure and energy cables, presents one more important progress alternative.

In keeping with numerous stories, the Indian wire and cable market has surged to roughly ₹750 billion in FY 2022-23, up from ₹335 billion in FY 2014-15. The trade is estimated to have registered a quantity progress of round 10% between FY15 and FY23.

Wanting forward, it’s anticipated to develop at a CAGR of 13% by means of FY27, reaching ₹1,200 billion, fueled by greater authorities spending on infrastructure, progress in the true property sector, and elevated non-public capital expenditure.

The conductor market in India can be experiencing outstanding progress. In 2023, the market was valued at roughly USD 1.5 billion. It’s projected to develop at a CAGR of 8–10% between 2023 and 2028, with an anticipated market worth of USD 2.2 to 2.5 billion by 2028.

Authorities initiatives are additional driving demand for conductors, significantly in rural areas. Schemes just like the Saubhagya Scheme, aimed toward common electrification, and the Deen Dayal Upadhyaya Gram Jyoti Yojana (DDUGJY), designed to enhance rural electrification and energy infrastructure, are enjoying a significant position in supporting this progress trajectory.

Strategic enlargement plans

The corporate throughout FY24 recognized important progress alternatives within the photo voltaic and electrical car (EV) sectors, pushed by growing demand for renewable power options and electrical mobility.

To satisfy the growing demand and capitalise on market alternatives, it’s planning important expansions in each the photo voltaic wire and cable market in addition to the EV cable market over the following three years.

These contains growing its manufacturing capability to supply a broader vary of high-quality cables that meet the evolving wants of those sectors. By increasing manufacturing capabilities, the corporate goals to strengthen its market presence and guarantee a dependable provide of superior cable options.

Diamond Energy is trying to enter new markets by leveraging its expanded capability and strategic partnerships, involving exploring alternatives in rising markets with excessive potential for photo voltaic and EV adoption, as per the corporate’s FY24 annual report.

Disclaimer: The views and proposals given on this article are these of particular person analysts. These don’t symbolize the views of Mint. We advise buyers to test with licensed consultants earlier than taking any funding selections.