Penny stock Pulsar International has recently captured the market’s attention with its astonishing performance, turning into a multibagger and delivering exponential returns to its investors over the past five years.
This impressive rise has seen the stock soar by a massive 13,200%, moving from a mere ₹0.10 in July 2019 to its current level of ₹13.3. Such remarkable growth highlights the company’s robust performance and the confidence it has garnered in the market, making it a standout among its peers.
Over the past three years, the stock’s upward trajectory has been equally noteworthy. From ₹0.16 in July 2021, it has surged by an impressive 8,212% to reach its current valuation. This kind of exponential growth is rare and signifies the significant turnaround and growth potential that early investors recognized. Those who invested in Pulsar International early have seen their investments multiply significantly, showcasing the stock’s ability to deliver extraordinary gains.
Pulsar International has continued to demonstrate strong performance, rising over 43% over the past year and over 67% year-to-date in 2024. Despite the recent decline of over 5% in July, following four straight months of gains, the stock’s performance remains impressive. It jumped 23% in June, 3.6% in May, 35% in April, and 0.3% in March, although it shed 11% in February after advancing 15% in January 2024.
Currently, the stock is nearly 8% below its record high of ₹14.4, hit last month in June 2024. This resilience is further evidenced by its significant recovery, surging over 119% from its 52-week low of ₹6.08 recorded in November 2023. Such figures reflect the strong market confidence in Pulsar International and its ability to rebound and maintain upward momentum.
Pulsar International Limited, based in Ahmedabad, India, was incorporated in 1990. The company is engaged in the buying, selling, and dealing of industrial and consumer goods, materials, and commodities. It deals in chemicals, pesticides, petrochemicals, and pharmaceutical products, making it a versatile player in various sectors.
In the March quarter (Q4FY24), Pulsar International reported a standalone net profit of ₹76 lakh, reversing a loss of ₹15.5 lakh in the same period last year. Revenue for the quarter stood at ₹899 lakh, a decline of over 54% from ₹1,978 lakh a year earlier. Total expenses fell to ₹822 lakh from the previous year’s figure of ₹1,728 lakh. For the fiscal year 2023-24, the company achieved a consolidated net profit of ₹180 lakh, a substantial improvement from a net profit of ₹13.19 lakh in FY23. Revenue for FY24 surged to ₹1,978 lakh, a multifold increase compared to ₹36.88 lakh in the previous financial year.
Domestic brokerage house ICICI Direct highlights the key strengths of Pulsar International, noting its strong momentum with the stock price remaining above short, medium, and long-term moving averages. The company has demonstrated robust annual EPS growth and has been effectively utilizing its capital to generate profit, as evidenced by an improving Return on Capital Employed (RoCE) over the past two years.
However, ICICI Direct also points out some weaknesses, such as a decrease in promoter holding by more than -2% QoQ and declining net cash flow. Investing in penny stocks like Pulsar International offers the potential for substantial returns due to their lower price points, but it also involves significant risks.
These stocks often face liquidity issues, resulting in lower trading volumes compared to larger companies. Additionally, they may be subject to less stringent financial reporting requirements and oversight, increasing the risk of market manipulation and fraudulent activities.
Despite these risks, Pulsar International’s extraordinary performance over the past five years makes it a noteworthy player in the stock market. Its remarkable turnaround and upward trajectory underscore its potential as a high-return investment opportunity for the future. Investors must conduct thorough research and adopt robust risk management strategies to navigate the challenges associated with penny stocks and safeguard against potential losses.
