Bulk Deal Exposes Ashish Kacholia's Multibagger Stock Pick of 2024

Lately, there's extreme enthusiasm about India's prospects. People who never bet on stocks as a proxy of India's bright future, are piling on.

Maybe even rightly so.

A critical aspect that investors are looking towards is what's the smart money doing in this period?

Here, we broadly classify smart money into three buckets... the foreign investors, the domestic mutual fund managers and lastly the superstar investors with proven long-term track records.

Investors like Vijay Kedia, Ashish Kacholia and the likes.

In today's article, we'll look at Dalal Street's 'Big Whale' Ashish Kacholia's latest stock pick and why he added stake in the SME company.

Before we delve deep into the stock details, let's look at who Ashish Kacholia is and what are some of his top stock picks.

Who is Ashish Kacholia?

When we talk about successful investors in India, it's common to mention Ashish Kacholia.

Kacholia is known for identifying the best multibagger stocks. He is known as the 'Big Whale' of the Indian stock market.

Over the years, he has picked the best multibagger stocks by looking at the fastest-growing companies from the midcap and smallcap space.

He started his career with Prime Securities in 1993. In 2003, he started Hungama Digital Entertainment Company along with Rakesh Jhunjhunwala. He is also the proprietor of Lucky Securities.

Which SME Stock Did Ashish Kacholia Buy?

The latest bulk deal data shows that ace investor Ashish Kacholia picked up a stake in the recently-listed SME company - Megatherm Induction.

As per NSE data, Kacholia picked up 3.16 lakh shares of the company through a bulk deal on Thursday.

The average price for the deal was at Rs 224.96 and the total cost was around Rs 71.2 million (m).

While we don't know why exactly Ashish Kacholia decided to buy a stock that already had a bumper debut just 4 days ago, there are some reasons we could guess...

Megatherm Induction's recent IPO saw massive interest from investors across categories, with the IPO reaching 200.5 times subscription in the retail category, 105.1 times in the QIB category, and 307.04 times in the NII category.

What followed was a blockbuster debut on the NSE SME platform, with its share price listing at Rs 198, compared to the issue price of Rs 108.

All this indicates the company does have strong momentum right now and could possibly cash in on the booming market.

The company specializes in manufacturing induction heating and melting products. It also has an established clientele base both in the domestic as well as the export market.

The company has strong growth prospects owing to increased usage of scrap and towards the secondary steel segment. Many new production capacities are being added to meet the growing demand.

As of October 2023, Megatherm Induction had a strong order of Rs 3.5 billion (bn) providing near term revenue visibility.

How Megatherm Induction Share Price has Performed Recenty

Since listing, the stock is up over 136%, doubling investors' wealth in just five days.

Shares of the company are locked in the upper circuit band ever since it was announced that Kacholia has invested in the company.

Here's a table comparing Megatherm Induction with its peers -

Comparative Analysis

Company	Megatherm Induction	Aeroflex	Amba Ent	Pavna Industries
ROE (%)	32.1	30.5	17	13.3
ROCE (%)	30.1	32.7	20.8	12.7
Latest EPS (Rs)	7.4	2.3	4.2	5.9
TTM PE (x)	32.4	65.8	32.4	86.9
TTM Price to book (x)	4.2	7.1	5.2	10.2
Dividend yield (%)	0	0.1	0.2	0.2
Industry PE	53.5
Industry PB	5.6

Data Source: Ace Equity

Happy Investing!

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...