Defying gravity! This smallcap multibagger stock turned Rs 10,000 to nearly Rs 7 lakh in 10 years

economictimes.indiatimes.com:

Shares of Bharat Rasayan have delivered bumper returns to investors over the last decade, rising as much as 6,600%. If an investor had invested Rs 10,000 in the stock 10 years ago and stayed put, the investment would have turned to Rs nearly 7 lakh, according to an analysis by ET Markets. In the last 3 years, the stock has surged 53% and gave returns of 103% in the last five years.

Bharat Rasayan, a smallcap company with a market capitalization of about Rs 3,798 crore, is a R&D driven chemical manufacturing company. It is engaged in the production of fatty acid anhydrides, grignard reagents, pharma intermediates, esters and solvents on a regular basis. The company is also one of the largest manufacturer of cosmetic ingredients with primary focus in the personal care (skincare, haircare and anti-bacterial ) preservatives.

It has an EPS of 383 on a trailing twelve month (TTM) basis and the stock is currently trading at a PB of 4.56. According to the latest shareholding pattern available with the exchanges, promoters own majority of the stake at 74.79%, while the rest of 25.21% lies with the public shareholders. Among the public shareholders, mutual funds don't have any stake in the company, while retail investors have a combined holding of 12.20% in the company.

For the quarter ended March, Bharat Rasayan clocked revenues of Rs 305.8 crore. PAT stood at Rs 32.6 crore.Technical outlook — What should investors do? Analysts say Bharat rasayan is trading at a discount when compared with its peers. «The demand in this sector also looks good.

Margins were under pressure from the last 3 quarters, which too seem bottomed out. The stock has a strong support near 8200 to 8500. Investors are advised to buy on dips near the support