THIS MIDCAP STOCK IS UP 35% IN MAY

Javed Alam Khan

 


Grindwell Norton Ltd (NS:GRNN), an abrasives company operating in the industrial consumables sector, is on a roll in the stock market. Its share price has zoomed over 35% in May to close at Rs 1,237 on May 11 on the back of strong Q4 FY21 numbers.

For the quarter ended March 31, 2021, Grindwell Norton reported consolidated total incomes of Rs 521.24 crore, up 38.79% from Rs 375.55 crore in the March 2020 quarter, and up 12.67 % from Rs 462.61 crore in the December 2020 quarter. It reported net profit of Rs 79.65 crore in the March 2021 quarter.

ICICI Securities gave a target of Rs 1,220 for the stock but Grindwell Norton comfortably surpassed it. The brokerage firm said, “Leveraging the support of the parent's research and global portfolio, GWN will be able to penetrate lucrative areas underperformance plastics (PPL), performance ceramics, and refractories (PCR). Margins under ceramics & plastics increased to 24% in FY21 vs 14% in FY20, given the solutions-based approach and the strong growth in performance plastics. Margins are likely to sustain at these elevated levels. Management is confident about doubling the revenues from PPL in 3-4 years.”

However, now it looks like the stock is running out of momentum. The stock price hit a high of Rs 1,305 in trade yesterday but is currently trading at Rs 1,221, down 1.3%.