With a market valuation of ₹6,317.06 Cr, Esab India Ltd. is a mid-size business that operates in the capital goods industry. In terms of consumables and welding and cutting equipment, the firm is a global leader. While declaring its Q3 earnings, the company has declared a dividend of 280% for its eligible shareholders in addition to being a debt-free company which is like a cube of ice on the cake for potential buyers.
Esab India said in a stock exchange filing that the Board of Directors “has declared Second Interim Dividend of Rs.28/- per equity share of Rs.10/- each (280%) for the financial year ending 31 March 2023 resulting in an outflow of Rs. 43,10,04,560/- (subject to deduction of tax at source where applicable). The said Second Interim Dividend declared by the Board of Directors would be paid to the equity shareholders on or before 10th March 2023.”
In Q3FY23, the company recorded revenue from operations of ₹267.39 crore, up by 18.01% YoY from Rs. 226.58 crore in the year-ago quarter. The company’s net expenses reached ₹221.98 crore in Q3FY23 against ₹202.23 Cr in Q3FY22, whereas the company’s profit before tax (PBT) stood at ₹48.57 crore in the quarter ended December against ₹25.81 Cr recorded in the quarter ended December 2021, representing a YoY growth of 88.18%. Esab India said its net profit for Q3FY23 reached ₹36.31 Cr compared to ₹18.97 Cr in Q3FY22, representing a YoY growth of 91.40%. The EPS of Esab India stood at ₹23.60 in Q3FY23 compared to ₹12.32 in the year-ago quarter.
On Friday, the shares of Esab India closed on the NSE at ₹4,082 apiece, down by 0.04% from the previous close of ₹4,083.50. The stock recorded a total volume average of 2,250 shares and a delivery volume average of 114,098 shares or 50.71%. The stock has produced a multibagger return of 406.39% over the past five years, and a multibagger return of 146% during the past three years. The stock has appreciated 47.11% over the past year, but YTD, it has fallen 3.39% so far in 2023.
The stock touched a 52-week-high of ₹4,337.95 on (21-Dec-2022) and a 52-week-low of ₹2,640.80 on (22-Feb-2022), indicating that at the current market price the stock is trading 5.90% below the 1 year high and 54.57% above the 1 year low. The company has a Price to Earning Ratio of 54.7, higher than its sector PE ratio of 49.2, however, Return on Equity(ROE) for FY22 was 34.5%, more than 20% in FY21. Esab India has a debt-to-equity ratio of zero, indicating that it is debt-free, and its TTM price/earnings-to-growth (PEG) ratio is 1.4, which is high in the industry, according to Trendlyne. During Q3FY23, the company reported a promoter shareholding of 73.72%, FIIs stake of 0.73%, DII holding of 13.26% and a public stake of 12.27%.
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