India's Best Performing Stock of 2023 Gained Over 6,000%

There has been a lot of crazy developments in the public markets since the start of 2023.

We saw an approximate 10% drop in indices at the start of the year. This was followed by an epic rally, off the bottom, that was fuelled by multiple factors by primarily because of FII buying.

These are just the structural movements though. The real fun has been happening in individual stocks.

A little-known stock involved in the manufacture of printed circuit boards has been the darling of the market.

It had an epic run from Rs 7 per share to today's price of Rs 466 per share. The current P/E ratio is 278 (no, I'm not making that up!).

This rally has taken the company's marketcap to almost Rs 4 billion (bn).

The company in question is Integrated Industries.

About Integrated Industries

Integrated Industries is primarily engaged in the manufacturing of printed circuit board (PCB).

The company also manufactures high quality single sided, double sided and multilayer PCBs with process technology from FUBA Printed Circuits Gmbh, a PCB supplier based in Tunisia.

In November last year, the company underwent a major rejig where the new promoters acquired shares via an open offer.

Integrated Industries has been out of operations and faced multiple challenges for reviving its operational plants.

It's only in recent years that the financials show a turnaround, and the company has also paid all its liabilities.

Financials, the Only Reasons for the Speculative Rally?

In financial year 2023, the company posted a net profit much higher compared to earlier years, which could be the main reason behind the speculative rally seen in this microcap stock.

This net profit came on the back of a one-time other income, which comprised of credit balances written back.

That was for 2023. Now, it appears that the company has resumed operations as it posted steady sales numbers for the first two quarters of FY24.

The company has already reported a net profit of Rs 11.7 million (m) and Rs 13 m in June 2023 and September 2023, respectively.

Financial Snapshot

Rs m, standalone	FY19	FY20	FY21	FY22	FY23	Q1FY24	Q2FY24
Other Income	0.8	0		1.2	51.4	194.7	467.4
Operating Profit	0	-1	-1.2	0	50	19.7	28.2
Net Profit	-1.8	-0.8	-1.2	-1.4	13.6	13	11.7
ROE (%)	0	0	0	0	0	-	-
ROCE (%)	-0.1	-2.4	-2.9	0.1	168.4	-	-
Dividend (Rs)	0	0	0	0	0	-	-
Debt to Equity (x)	-11.6	-9.8	-7.9	-6.6	1.8	-	-

Data Source: Ace Equity

The other logical reason behind this rally in Integrated Industries shares could be the low free float.

The stock has been in a never-ending rally due to scarce supply of shares, and people clamouring to buy whatever shares they can get their hands on.

Bright Industry Prospects

Printed circuit board, the company's primary manufacturing product, is used in almost all electronic devices, be it resistors, capacitors, integrated circuits, and connectors. This allows them to communicate and function as intended.

Currently, about 80% of printed circuit board assembly and box-build products are imported from China. However, there is a growing trend towards import substitution.

This comes on the back of global electronics manufacturers contemplating the China plus one strategy and looking for alternate manufacturing locations for export business.

The shift is creating tremendous investment potential for emerging countries like India.

With continued policy reforms such as the ongoing PLI schemes, the country seems well-poised to bite off a sizeable chunk of this opportunity.

How the Stock has Performed Recently

In the past one month, the stock has gained 26%.

On a year to date basis, the stock is currently India's best performing stock which has rallied over 6,000% since January 2023.

It has a 52-week high of Rs 467 touched on 20 December 2023 and a 52-week low of Rs 22 December 2022.

Also take a look at other best performing stocks of 2023.

Top Performing Stocks of 2023

Company	Current Price	Price as on 1 Jan 2023	Gains (%)
Prime Industries Ltd.	201.3	6	3266%
Eyantra ventures Ltd.	566	17.6	3116%
Jhaveri Credits & Capital Ltd.	264.4	10.3	2460%
SG Mart Ltd.	8,655.00	420.6	1958%
Remedium Lifecare Ltd.	499.9	25.1	1889%
Taylormade Renewables Ltd.	729.9	38.3	1808%
Pulsar International Ltd.	70.8	3.8	1754%
Tine Agro Ltd.	143.8	10.1	1328%
Jai Balaji Industries Ltd.	757	54.6	1286%
Sheetal Diamonds Ltd.	54.5	4.9	1018%
K&R Rail Engineering Ltd.	702.5	63.1	1014%
Mercury Ev-Tech Ltd.	120.2	11.9	908%
Madhuveer Com 18 Network Ltd.	108.2	10.9	893%
Artemis Electricals And Projects Ltd.	56.7	6.4	783%
Dhruva Capital Services Ltd.	198	23.4	746%
Rajoo Engineers Ltd.	230.4	29.2	689%
S&S Power Switchgear Ltd.	166.3	21.8	663%
J Taparia Projects Ltd.	51.2	7	632%
Insolation Energy Ltd.	696.2	103.6	572%
Piccadily Agro Industries Ltd.	277.5	42.3	557%

Data Source: Ace Equity

A word of caution...low-float shares fall at the same pace that they have risen.

Historically, large free-float size companies are considered more stable while the ones with smaller public exposure are volatile.

Shares with a higher float are usually the ones with better governance since the promoter has lesser influence and shareholders have more power to exercise their rights.

So before investing in such stocks, one must do their homework. Although low free float companies can be rewarding, they can be equally risky.

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...