Multibagger gems and jewellery stock, Sky Gold, hit 5% lower circuit after receiving board members approval for the allotment of 9 bonus shares on existing 1. Despite the latest drop, Sky Gold continues to be among 2024 multibaggers with gains of nearly 275%.
Ace investor Ashish Kacholia holds shares in Sky Gold. Should you buy the stock?
Sky Gold Share Price:
During trading hours of November 27, Sky Gold stock froze at its 5% lower circuit to Rs 3734.95 apiece on BSE, with a market cap of Rs 5,473.20 crore. Lower circuits generally mean several sellers in a stock but no buyers.
Despite this, Sky Gold is still a multi-bagger and strong performer in 2024. YTD, the stock has zoomed by a whopping Rs 2,738.35, or 274.77%. At the start of 2024, the stock price was Rs 996.60 apiece. The stock’s price-to-equity ratio is 68.71x, while return on equity is 32.63%.
The stock’s 52-week high and low is at Rs 4,325 apiece and Rs 902.10 apiece respectively.
Sky Gold Bonus Issue:
On November 26, the company informed that it received approval for the issuance of Bonus Equity Shares in the proportion of 9:1 i.e., 9 (Nine) new (Bonus) fully paid equity shares of ₹ 10/- (Rupees Ten only) each for every 1 (One) existing fully paid-up equity share of ₹ 10/- (Rupees Ten only) each held by them and that the new bonus equity shares so issued and allotted shall, for all purposes, be treated as an increase in the paid-up capital of the Company held by each such member.
The record date for the 9:1 bonus issue is yet to be announced. However, the company has revealed that it plans to issue about Rs Rs. 1,33,89,19,290/- consisting of 13,38,91,929 equities as bonus shares.
Sky Gold aims to finish its bonus issuance within two months from the date of the Board approval i.e. on or before 24th December 2024.
Accordingly, the record date is likely to be in December.
Should You BUY Sky Gold Stock?
As per MarketsMojo’s latest report, Sky Gold, a leading diamond and gold jewellery company, has been in the news for its stock performance. Despite a recent decline of -5.0%, the company has consistently traded higher than its moving averages and has been recommended as a ‘Buy’ by MarketsMojo. It has also outperformed the Sensex in the last month, showing its resilience and potential for growth.
Sky Gold announced its net profit recorded growth of 405.2% YoY to Rs 36.7 crore in Q2FY25, while its EBITDA skyrocketed by 154.3% YoY to Rs 38.8 crore. Revenue from operations stood strong at Rs 768.8 crore, recording a growth of 94.2% YoY.
In the quarter, the company raised about Rs 270 crore through a Qualified Institutional Placement (QIP) from renowned funds like Motilal Oswal Small Cap Fund, Kotak Mahindra Life Insurance and Bank Of India Flexi Cap among others. Also, the company added CaratLane and P N Gadgil Jewellers to its client portfolio, while its manufacturing margin-accretive 18-carat gold and diamond jewellery.
The company said its scaling of acquired companies i.e., Sparkling Chains and Starmangalsutra to achieve target sales of Rs. 500 crore by Q4FY25.
Sky Gold is positioning itself for long-term growth by embracing digital automation and optimizing cost efficiency in its production lines. With a strong management and leadership team, the company is set to build on its momentum and drive sustained value in the coming quarters, as per the filing.