Multibagger stock in focus today on withdrawal of factory closure order in Telangana

Shares of Premier Explosives are in news today after the defence firm said the Telangana Pollution Control Board (TGPCB) has revoked its closure order, permitting the company to resume production activities at its Yadadri-Bhuvanagiri factory. The closure, originally imposed after a major fire and explosion at the facility in April, resulted in at least three deaths and injuries to six other individuals.

Premier Explosives stock ended 2.17% lower at Rs 546.55 on Tuesday against the previous close of Rs 558.65 on BSE. Total 0.28 lakh shares of the firm changed hands amounting to a turnover of Rs 1.55 crore on BSE. Market cap of the firm slipped to Rs 2938 crore. In two years, the multibagger stock has gained 172.25% and risen 457.65% in three years. 

The factory, based in Katepally village, Motakondur Mandal, manufactures industrial explosives and detonators used across mining, infrastructure, defence, and space sectors.

In June, the company informed the stock exchanges about the TGPCB order dated 2 June, which allowed the reopening for three months, subject to payment of an environmental compensation of ₹6,75,000. Premier Explosives stated, "We will ensure compliance of conditions mentioned in the order and resume production from the factory at the earliest," emphasising its commitment to regulatory requirements.

In its corporate filing, Premier Explosives reiterated, "The company will ensure all compliances of the conditions as mentioned in the TGPCB order," though the specific conditions were not detailed in the disclosure. This regulatory approval is seen as a significant development for the company, which had faced operational challenges due to the incident and subsequent closure.

The accident had prompted increased scrutiny from regulatory authorities, and the company’s ability to swiftly secure permission to restart operations may help in restoring confidence among stakeholders. Production resumption is expected to contribute to stabilising operations and revenue streams adversely impacted by the factory shutdown.