Rs 4 to Rs 75: This penny stock turned into a multibagger in one year

Brightcom Group stock has delivered 1,705 per cent returns in one year. The stock, which closed at Rs 4.18 on November 4, 2020 rose to a high of Rs 75.40 on the Bombay Stock Exchange (BSE)on November 4 this year.

An amount of Rs 1 lakh invested in the shares of Brightcom Group a year ago would have turned into Rs 18.03 lakh today. In comparison, Sensex has risen 47.89 per cent during the period.

The share hit a 52-week high of Rs 90.55 on October 13 this year. However, it has seen profit-booking since then.

On November 4, the stock closed 0.87% higher at Rs 75.40 in the Diwali Muhurat trading session. Total 2.78 lakh shares changed hands amounting to turnover of Rs 2.10 crore on BSE. Market cap of the IT software firm rose to Rs 7,853.91 crore.

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Brightcom Group shares have gained 1,002 per cent since the beginning of this year and climbed 17 per cent in one month. Brightcom Group shares stand higher than 5 day, 20 day, 50 day, 100 day and 200 day moving averages.

The mid-cap stock has lost 1.5 per cent in a week.  The stock is included under the first stage of additional surveillance measures (ASM) on BSE.

The maximum possible rise or fall in these scrips will be up to 5 percent which will help reduce sudden price fluctuation preventing shareholders against big losses.

The shortlisting is based on the following parameters: high low price variation, client concentration, number of price band hits, price variation between closings and P/E ratio.

Promoters held 22.40 per cent stake in the firm and public shareholders owned 77.60 per cent at the end of September quarter.

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1.07 lakh public shareholders owned 80.83 crore shares of the firm. Of these, 1.05 lakh shareholders held stake with capital up to Rs 2 lakh. Only 683 shareholders with 20.78% stake held capital above Rs 2 lakh at the end of September quarter.

18 foreign portfolio investors (FPIs) held 0.38% stake or 40.01 lakh shares in Q2 of the current fiscal.

The share of the firm has outperformed its peers in the last one year.

While Tata Elxsi share has risen 305 per cent, stock of another competitor Tanla Platfoms has gained 259 per cent in one year. Share of Newgen Software managed to climb 135.82 per cent in one year.

However, the phenomenal rise in the stock of Brightcom Group does not reflect the financial performance of the firm. In the June quarter, it reported a profit of Rs 105.55 crore lakh against Rs 101 crore profit for the June quarter last fiscal.

Sales rose 2.27% to Rs 654.05 crore in June quarter against Rs 639.55 crore sales in the corresponding quarter of last fiscal.

On a quarter-on-quarter basis, net profit fell 24.62% from Rs 140 crore in the March quarter of last fiscal. Sales fell 6.48% from Rs 699.36 crore in the March quarter.

However, the stock seems to be pushed higher by a number of key developments this year.

On September 16, 2021, Brightcom Group said it allotted 140.15 million equity shares to foreign portfolio investors (FPIs) and other investors through a preferential allotment at a price of Rs 37.77 per share. In the next 18 trading sessions, the share more than doubled from the level of Rs 34.39.

The firm also announced allotment of 15 million warrants at Rs 37.77 per share, convertible into equal number of equity shares on a preferential basis to Shankar Sharma, vice chairman & joint managing director at First Global.

Among other key developments, the firm paid off all bank loans and became a debt-free company in 2021. The company issued bonus shares in the ratio of 1:4 i.e. one bonus share for every four equity shares held by the shareholders of the company.

Brightcom Group offers digital marketing solutions to businesses, agencies and online publishers worldwide. It connects advertisers with their audience across any form of digital media, using its massive local presence to deliver appropriate messages to the right audience, through the most relevant digital channels.

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