Maan Aluminium Shares Surge 5% on Expansion Plans – Should You Invest?
Maan Aluminium Expands Manufacturing Capacity, Stock Rises
Maan Aluminium Limited, one of India’s leading manufacturers and exporters of aluminium extruded products, saw its stock price jump by 4.95% during Thursday’s trading session. The rally came after the company announced its plans to expand its manufacturing business further.
At 2:18 p.m., Maan Aluminium shares were trading at ₹98.95, up from the previous closing price of ₹94.33 on the Bombay Stock Exchange (BSE). With a market capitalization of ₹535.2 crores, the stock has delivered negative returns of nearly 29% over the past year but has gained around 12% in the last month.
Expansion Plans Drive Investor Interest
Maan Aluminium’s latest regulatory filing revealed that the company is making aggressive moves to expand its aluminium extrusion and value-added services. As part of its expansion strategy, the company has acquired a new facility on MB Road, Devas, Madhya Pradesh. The newly acquired land spans approximately 13,117 square meters, and the total investment for this acquisition amounts to ₹8.75 crores, excluding stamp duty and additional charges.
This expansion follows an earlier acquisition on December 30, 2024, when the company purchased another facility near its existing plant in Pithampur, District Dhar, Madhya Pradesh. The previous land acquisition covered 8,500 square meters, with an investment of ₹7.21 crores.
By securing additional manufacturing space, Maan Aluminium aims to strengthen its production capabilities, meet growing demand, and scale up its operations in the aluminium extrusion sector.
Financial Performance: Declining Revenues and Profitability
Despite the positive news on expansion, Maan Aluminium’s latest financial results indicate a decline in revenue and profitability. In Q3 FY25, the company’s revenue fell by 14.5% YoY, decreasing from ₹213 crores to ₹182 crores. Meanwhile, net profit took a significant hit, dropping from ₹7.44 crores to ₹3.05 crores, representing a 59% decline YoY.
The decline in financial performance may have been influenced by market conditions, rising input costs, and fluctuating aluminium prices. However, with the company investing in expanding its infrastructure, future growth prospects look promising.
Company Overview and Production Capacity
Maan Aluminium Limited specializes in the manufacturing and trading of aluminium profiles, anodizing and fabrication of profiles, aluminium ingots, aluminium billets, and other related activities. The company has a robust production capacity, with 4,199 MT of production in H1 FY25, an annual machining capacity of 1,200 MT, and an annual anodizing capacity of 3,600 MT.
Financial Ratios and Key Metrics
To better understand Maan Aluminium’s financial health, let’s take a look at its key financial ratios and stock metrics:
| Metric | Value |
|---|---|
| Market Cap | ₹535 Cr. |
| Current Price | ₹99.0 |
| 52-Week High/Low | ₹260 / ₹82 |
| Stock P/E | 28.4 |
| Book Value | ₹31.7 |
| Dividend Yield | 0.00% |
| Return on Capital Employed (ROCE) | 24.9% |
| Return on Equity (ROE) | 22.3% |
| Face Value | ₹5.00 |
| Promoter Holding | 58.9% |
| Price to Book Value | 3.12 |
| Debt to Equity Ratio | 0.24 |
| Pledged Shares | 0.00% |
| Industry P/E | 23.8 |
| Graham Number | ₹49.9 |
| Intrinsic Value | ₹95.8 |
| Relative Strength Index (RSI) | 46.6 |
| Earnings Per Share (EPS) | ₹3.49 |
| Number of Equity Shares | 5.41 Cr. |
| PEG Ratio | 0.98 |
| 200-Day Moving Average (DMA) | ₹133 |
| Free Cash Flow (3 Years) | ₹47.4 Cr. |
| Free Cash Flow (5 Years) | ₹43.0 Cr. |
| Debt | ₹40.7 Cr. |
| Return on Assets | 14.6% |
Should You Invest in Maan Aluminium?
Maan Aluminium’s recent stock rally reflects investor confidence in its expansion plans. The company’s decision to acquire new manufacturing facilities indicates a long-term growth strategy aimed at scaling production and enhancing operational efficiency.
However, investors should be mindful of the company’s recent decline in revenue and profitability. While the stock has gained in the last month, it has underperformed over the past year, suggesting volatility. The company’s P/E ratio of 28.4 is slightly higher than the industry average of 23.8, meaning the stock might be somewhat overvalued.
With a low debt-to-equity ratio of 0.24, strong promoter holding of 58.9%, and an ROE of 22.3%, Maan Aluminium remains financially stable. The intrinsic value of ₹95.8 is close to its current price of ₹99, indicating a fair valuation.
Conclusion
Maan Aluminium’s stock price jump after announcing expansion plans shows that the market is optimistic about the company’s future. However, investors should consider both the opportunities and risks before making investment decisions. The declining revenue and profit margins are concerns, but the expansion efforts might lead to long-term growth.
If you are a long-term investor looking for a stock in the aluminium manufacturing sector, Maan Aluminium could be worth watching. However, it’s advisable to keep an eye on the company’s future earnings reports and market conditions before making a final decision.
Would you invest in Maan Aluminium? Let us know your thoughts in the comments below!
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.