BCL Industries Shares Soar 16x from Covid Lows; Analysts Predict Further 70% Upside


BCL Industries, a prominent player in the fast-moving consumer goods (FMCG) sector, has emerged as a standout performer in the stock market, delivering exceptional returns of over 1,550% from its Covid-19 lows around Rs 28. This remarkable surge has piqued the interest of investors and analysts alike, prompting optimistic projections of up to a 70% further increase in the stock’s value.

BCL Industries specializes in the manufacturing of vanaspati ghee, refined edible oils, and various other consumer products. Despite its impressive ascent, experts on Dalal Street maintain a positive stance on the stock, anticipating substantial gains in the near future.

The company’s recent announcement of a 1:10 sub-division of its equity shares has generated buzz, although the record date for this event remains pending. As of the latest update, BCL Industries shares were trading approximately 2% higher at Rs 463, contributing to an overall market capitalization of around Rs 1,115 crore. This comes on the heels of the stock’s previous close at Rs 458.85 in the preceding trading session.

The trajectory of BCL Industries shares has been nothing short of extraordinary. The stock has surged by an astonishing 1,550% from its pandemic-induced lows of Rs 28. Moreover, it has witnessed a 67% upswing from its 52-week lows of Rs 276.15 recorded on November 15, 2022. Impressively, the stock has already registered a 42% increase since the beginning of 2023.

InCred Equities, a leading brokerage, is optimistic about BCL Industries’ profitability exceeding expectations. The company’s adept control over losses in the oil segment has significantly contributed to its impressive performance. With an ‘add’ rating and a target price of Rs 790, InCred Equities underscored BCL Industries’ robust prospects. The recent commissioning of a 200 KLPD ethanol plant and rice straw boiler in Punjab has added to its growth potential, promising enhanced profitability in the upcoming periods.

BCL Industries’ re-entry into the IMIL (Indian Made Indian Liquor) market in Punjab presents another avenue for growth, although InCred Equities has yet to factor in potential contributions from this segment. The brokerage emphasized the importance of understanding the broader Food Corporation of India (FCI) rice situation, which would impact decisions related to the raw material for ethanol production.

For the quarter ending June 2023, BCL Industries reported a net profit of Rs 18.62 crore, reflecting a 5% YoY increase from the corresponding quarter in 2022. The company’s revenue climbed by an impressive 14.35% YoY to reach Rs 428.67 crore, showcasing its ability to capitalize on market opportunities.

Notably, the operational profit (EBITDA) for BCL Industries during the June 2023 quarter stood at Rs 41.30 crore, demonstrating a remarkable growth rate of 31% compared to the same quarter in the previous year.

Kranthi Bathini from Wealthmills Securities weighed in on BCL Industries, suggesting that while the next two to three quarters might present challenges, the stock still holds potential for a 15-20% appreciation from its current levels. Bathini emphasized that BCL Industries’ focus on ethanol blending and its spirit business will be key drivers for growth in the upcoming quarters.

As BCL Industries continues to chart an impressive trajectory in the stock market, the FMCG giant’s multifaceted growth strategy, coupled with its resilience and adaptability, positions it favorably for sustained success. While challenges are acknowledged, analysts are united in their positive outlook for BCL Industries’ future performance, marking it as one of the standout stories in the stock market landscape.

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