Rs 0.80 to Rs 52: This penny stock turned into a multibagger in one year

Stock of Simplex Papers has delivered 6,406% returns to its shareholders in the last one year. The penny stock, which stood at Rs 0.80 on December 3, 2020, rose to a 52-week high of Rs 52.05 on the BSE today. An amount of Rs 1 lakh invested in the Simplex Papers stock a year ago would have turned into Rs 65.06 lakh today.

In comparison, Sensex has risen 29.82% during the period. The microcap stock has gained 169.69% in the last 21 sessions. The stock opened with a gain of 4.94% at Rs 52.05 and was stuck in the upper circuit of 5% for a majority of session.

Simplex Papers stock stands higher than the 5 day, 20 day, 50 day, 100 day and 200 day moving averages.

Market cap of the firm rose to Rs 15.62 crore. Total 18,000 shares of the firm changed hands amounting to a turnover of Rs 9.30 lakh on the BSE today.

The share hit a 52-week low of Rs 0.84 on December 21, 2020. The stock has gained 157.04% in one month and zoomed 5,814% since the beginning of this year.

For the quarter ended September 2021, 13 promoters held 72.05% stake or 21.62 lakh shares and 5,174 public shareholders owned 27.95% stake or 8.38 lakh shares of the company.

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5,047 public shareholders held individual share capital of up to Rs 2 lakh and owned 3.76 lakh shares or 12.54% stake at the end of the September quarter.

No shareholder owned individual share capital above Rs 2 lakh in the last quarter. One mutual fund held 102 shares in the firm.

Life Insurance Corporation (LIC)  held 12.91% stake or 3.87 lakh shares of the firm at the end of the September quarter.

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The Oriental Insurance Company owned 1.70% stake or 50,940 shares of the firm. Nine financial institutions held 4,942 shares or 0.16% stake in the firm at the end of the September quarter.

However, the financial performance is not in line with the stellar rise in stock of the firm. The firm has logged zero sales since quarter ended March 2017. It last clocked sales of Rs 0.08 crore for the quarter ended December 2016.

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One should also consider the below factors before entering the counter.

The company is a loss making one. It has been incurring losses since quarter ended March 2017. It posted profit only once during the period. For the quarter ended March 2021, the firm logged a profit of Rs 0.10 crore.

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However, Simplex Papers stock has outperformed its peers in terms of market returns during the last one year.

While Andhra Paper share has gained 11.93%, share of Orient Paper has risen 61% in one year.  Share of another peer Vapi Paper Mills has lost 42.64% during the period. Agio Paper Ltd stock has clocked a rally of 345.65% in the last one year.

Simplex Papers Ltd is engaged in the manufacturing and trading of paper products. The company offers printing and writing paper.

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