1:10 stock split effect: Multibagger BSE SME stock turns ₹1.16 lakh to ₹7.80 lakh in 2 years

Investors in Sudarshan Pharma Industries stock must be delighted. Following the 1:10 stock split, this multibagger small-cap stock has multiplied investors’ wealth by nearly seven times. Sudarshan Pharma Industries announced a 1:10 stock split on November 5, 2024. This means that each share with a face value of ₹10 was split into 10 shares with a face value of ₹1.

How did it benefit the investors who bet on Sudarshan Pharma IPO two years ago?

Sudarshan Pharma launched its initial public offering (IPO) on March 9, 2023, offering a lot size of 1,600 shares for ₹1,16,800. Following a 1:10 stock split, each investor’s shareholding increased to 16,000 shares. With the current stock price hovering around ₹48.80, the absolute value of an allottee’s investment now stands at ₹7,80,800. This means ₹1.16 lakh of investors turned to ₹7.80 lakh in about two years.

Sudarshan Pharma share price trend

Sudarshan Pharma share price dropped 2 per cent to hit its lower circuit of ₹48.80 on the BSE on Friday, January 10, ahead of its board meeting.

According to an exchange filing, the company’s board of directors will meet on January 10 to “evaluate the proposal for raising of funds through securities, convertible instruments and through any permissible method.”

The multibagger stock has surged over 500 per cent over the last year. It hit a 52-week high of ₹53.50 on January 7 this year and a 52-week low of ₹5.82 on June 4 last year on the BSE.

On a monthly scale, the stock has been in the green since November last year, defying weak market sentiment.

Sudarshan Pharma IPO details

The SME IPO was entirely a fresh issue of nearly 69 lakh shares to raise about ₹50 crore, which it wanted to use for working capital requirements.

About 51 per cent of the issue was reserved for retail investors. With a price band of ₹71 to ₹73 per share and a lot size of 1,600 shares, the minimum amount of investment for retail investors was ₹1,16,800.

Sudarshan Pharma Industries business overview

The company is engaged in diversified business in the pharmaceutical industry and speciality chemicals in the chemical industry. It exports its products to the UK, Australia, Uzbekistan, Syria, Oman, Taiwan, and MENA Regions.

According to the company’s website, it is also involved in contract manufacturing, outsourcing and supply of generic pharma formulation and medicines.

According to the company’s exchange filing, for the first half of the current financial year (H1FY25), the company’s revenue from operations declined 1.7 per cent year-on-year (YoY) to ₹227.8 crore. Profit after tax (PAT), however, jumped 22 per cent YoY to ₹5.9 crore. EBITDA margin for the period under review climbed to 7.3 per cent from 3.6 per cent in the corresponding period last year.

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