Small Cap Penny Stock In Focus On Declaring Amazing Q3 Results With Revenue Surging 23%

On Tuesday, shares of infra and engineering company Salasar Techno Engineering Ltd surged around 17 per cent to an intraday high of Rs 9.41 per share from its previous closing of Rs 8.16 per share. The stock's 52-week high is Rs 24.15 and its 52-week low is Rs 7.80. The company has a market cap of over Rs 1,600 crore with multibagger returns of 1,089 percent in 5 years.

At its meeting on March 26, 2025, the Salasar Techno Engineering Limited Board of Directors reviewed and approved the proposed plan to merge Salasar Techno Engineering Limited with EMC Limited, a fully owned subsidiary of Salasar, on Wednesday. The NCLT additionally has to approve the scheme after it has been approved by the appropriate authorities, if applicable. At their separate meetings on March 26, 2025, the company's Independent Directors' Committee and the Audit Committee of the Board of Directors also examined and recommended acceptance of the proposed scheme.

Salasar Techno Engineering Ltd (STEL) recently entered into a non-binding Memorandum of Understanding with Elegant Forge & Equipments Pvt Ltd on February 13, 2025, which will give the parties two years to negotiate and hire an independent third jurist for the arbitration clause to work around the acquisition of Elegant Forge. The company has an industrial facility and specializes in designing components for industrial forging equipment and building components from an array of engineering, railways, defence, oil and gas, and even aerospace industries.

In a recent notable decision, the Hon'ble National Company Law Tribunal, Kolkata, has sanctioned the completion of the liquidation proceedings of EMC Limited, which has been sold as a going concern to Salasar Techno Engineering Limited and is now closing the proceedings of the liquidation. The company obtained the certified true copy of the NCLT order on 15th January 2025. In addition, STEL has received approval to merge with its subsidiary company Hill View Infrabuild Limited, which is an infrastructure development company. The merger, sanctioned under the Companies Act, 2013, will reduce the number of holding companies and improve the operational efficiency of the group.

In consideration, Hill View Infrabuild shareholders shall receive Salasar Techno equity shares and preference shares for every hundred shares held, 287430 and 8358 respectively.

For the Q3FY25 Salasar Techno Engineering Limited reported healthy financials with a 33.3% year-on-year increase in net sales to Rs. 375.18 crore and a 23.3% rise in net profit to Rs. 11.95 crore as compared to Q3FY24. For the nine months ending December 2024 (9MFY25), net sales for the company registered a growth of 13% to Rs 950.67 crore but net profit for the period fell by 11%, standing at Rs 32.11 crore as compared to last year. The company for FY24 reported net sales of Rs 1,208.43 crore and net profit of Rs 52.95 crore.

As of December 2024, Domestic Institutional Investors (DIIs) have purchased 1,500,000 shares which constitute a 0.09% holding in the company. Over the past five years, STEL has increased its valuation by 780%, a figure that sheds light on the level of confidence investors have in the company.

The scheme shall be approved by NSE Limited, BSE Limited, SEBI, the company's shareholders, creditors, and any other statutory bodies as applicable. The NCLT shall also further sanction it. At their separate meetings on December 30, 2024, the company's Independent Directors' Committee and the Audit Committee of the Board of Directors also examined and recommended acceptance of the proposed scheme.

For every 100 equity shares of Rs 10 held in Hill View Infrabuild Limited, Salasar Techno Engineering Limited would issue 2,87,430 equity shares of Rs 1 each, credited as fully paid-up, to the equity shareholders. For every 100 equity shares of Rs 10 each owned in the Hill View Infrabuild, Hill View Infrabuild Limited, Salasar Techno Engineering Limited would issue 8,358 5% non-cumulative compulsory redeemable preference shares, credited as fully paid up.

"The proposed Amalgamation would result in pooling of physical, financial and human resource of these Companies for the most beneficial utilization of these factors in the combined entity. The proposed Scheme of Amalgamation will result in usual economies of a centralized and a large company including elimination of duplicate work, reduction in overheads, better and more productive utilization of financial, human and other resource and enhancement of overall business efficiency. The proposed Scheme will enable these Companies to combine their managerial and operating strength, to build a wider capital and financial base and to promote and secure overall growth," said Salasar Techno Engineering in a stock exchange filing.

Revenue for the firm climbed 2.2% year over year to Rs 2,814.9 million in Q2FY25 from Rs 2,753.5 million in Q2FY24. EBITDA also reflected this trend, boosting margins as it increased 3% to Rs 256.6 Mn in Q2 FY25 from Rs 249.2 Mn at the same time the year before. The PAT for Q2FY25 increased from Rs 90.5 Mn in Q2 FY24 to Rs 96.8 Mn, with margins exhibiting a boost to 3.4% from 3.3% Y-o-Y.

One of India's top suppliers of specialised steel infrastructure solutions is Salasar Techno Engineering Limited (STEL), which was established in 2006. For a variety of goods, including telecom towers, power transmission structures, solar structures, and railway electrification components, it provides engineering, design, manufacturing, galvanisation, and installation services.