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MultiBagger shares in focus: In its latest report, global brokerage firm Phillip Capital has covered the Vilas Transcore coverage with a ‘buy’ rating and a target price of £ 638 per share, citing the strong positioning of the company in India’s fast -growing energy sector. The broker also highlighted the robust financial statistics of Vilas Transcore, which he believes is particularly relevant in the light of the working capital-intensive nature of the transformer component industry. Vilas Transcore is working on the manufacture and supply of components used in the power distribution and transmission sector, and catering mainly to transformer and other manufacturers of power equipment in India and overseas. The company’s shares debuted in the Indian stock market in June 2024, with a £ 225 pair compared to the IPO price of RS147. At current levels, the share is trading at £ 392, which is 166% higher than the IPO price. The product range contains electrical lamination cold-rated granular (CRGO) cores, CRGOs, CRGO stacks (composite) grains, CRGO wound grains and CRGO-toroid components, mainly in power, spread, dry-temporary transport. High, medium and low voltage stream transformers. The broker noted that CRGO steel accounts for 30-35% of the total cost of a transformer, making it the largest cost component in transformer manufacturing. Cool -guned grain -oriented (CRGO) steel is a specialized electric steel used mainly in transformers, cars and generators. Its grain orientation significantly reduces the core losses, making it essential to improve the efficiency and performance of electrical equipment. As aid programs and private players tighten investments to meet the increasing power demand, Nismakers of CRGO steel grains come up as the most important beneficiaries. Vilas Transcore Ltd., one of the few CRGOs manufacturers in India, is at the forefront of this event. The demand for CRGO that raises CRGO (cold-armed grain-oriented) steel, which is essential for effective transformers and 30-35% of their costs, has an offer button in India due to the non-renewal of BIS export licenses for major Chinese suppliers. With India importing most of its 325 000 tonnes of annual CRGO needs from China, South Korea, Japan and Europe, the deficit of high-efficiency has increased Hi-B-B degree prices and tense transformer production. The global production is 3 million tonnes, with China contributing 45%. Domestic Transformator Makers and Discomers are struggling and threatening delays in infrastructure projects. As India pushes to 500 GW -renewable capacity by 2030 and from January 2025 instructed stricter transformational efficiency norms, the CRGe demand will increase by 10-12% annually. The broker spent well to capture the broker in the power sector. With its continued expansion of capacity (3x to 36,000 MTPA), a robust balance sheet and access to higher-margin product lines such as radiators, amorphic core and nanocrist allblies, VTL is ready for significant upcoming years. The strategic location in Gujarat, strong customer relationships and focus on serving organized transformer OEMs, positions it favorably as the sector moves to greater quality and efficiency. VTL also maintains a healthy cash balance and offers a buffer against input costs or fluctuations on the demand side. The capital structure allows financial flexibility to finance the growth cabinets without diluting the equity or increasing debt. In contrast, a large part of the industry – which exists unorganized and smaller players – works with high working capital requirements and limited liquidity, and places VTL in a structurally stronger financial position. Phillip Capital estimates a FY24–27th income, EBITDA, and Pat CAGR of 31.8%, 37.7%and 38.9%respectively. Disclaimer: The views and recommendations given in this article are those of individual analysts. This does not represent the views of coin. We advise investors to check with certified experts before making investment decisions. First published: 29 Apr 2025, 1:27 pm Ist