Gwalior Chemical Industries is a small cap stock which has garnered lot of market attention over the last couple of weeks. The stock has shot into prominence with one of the funds of Goldman Sachs Mauritius turning aggressive buyer in the counter over the last week. Goldman Sachs fund has acquired close to 1.6 million shares from the open market during the last week (almost on all trading days) at an average price of close to Rs95. This bulk deal has been reported in various business newspapers in the bulk deals section.
There is also a rumour that this company is going to be acquired by Bayer Life Sciences at the rate of Rs190/- per share but it has not been confirmed.
When we look at their financials, the topline has grown by 43.50% this year and the net profit has grown by 33.32%. The EPS per share works out to Rs9.85 compared to Rs9.43 for the last year. It means that there is a big equity dilution on the way. The share has today closed around Rs94 resulting in a PE of close to 10. Though it is not very cheap, the large accumulation by FII's may warrant some closer examination of the company, future business prospects.
Keep a close watch on Gwalior Chemical Industries!
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