Rise of two mid-cap companies: One reaching for the sun, see details
Maharashtra Scooters and Waaree Renewable Technologies are emerging as two hottest candidates in the mid-cap space. Both has recorded a blistering pace of revenue growth. Read on to find out how the two companies have performed in the past five years.
Kolkata: Maharashtra Scooters and Waaree Renewable Technologies are two of the hottest scrips in the mid-cap space, having achieved a blistering pace of revenue growth. Stock market investors often focus on prefer companies with fast growth in revenue, since this is one of the surest indicator of a robust business and growing demand of its products and/or services. Both investors and analysts are always on the look out for such performers.
A significant point is if such companies in the mid-cap space are able to pull off a robust performance year after year for a long period of time, they could also join the ranks of large cap stocks. The two companies discussed here have recorded five-year annual revenue growth ranges from 13 times to 123 times.
Maharashtra Scooters
Maharashtra Scooters is a misnomer as far as its nature of business is concerned. It now turned into the holding company for investments in high-profile Bajaj Group companies such as Bajaj Auto, Bajaj Finserv, and Bajaj Finance. More than 90% of its assets are invested in these companies. It doesn't manufacture anything and the firm's growth is determined by the value of its investments, dividends, and the performance of the Bajaj Group. The return on equity of Maharashtra Scooters seems low on account of its large investments and low operating earnings. The firm's investments are higher than its market cap. In other words, its shares are at a lower level than its book value and, therefore, one can expect appreciation in the future.
On October 31, the Maharashtra Scooters stock was trading at Rs 15,106, down Rs 1,079 or 6.67%. Investors are not very happy on the returns front since over the past five years, the returns have been to the tune of 443%.
Waaree Renewable
Waaree Renewable Technologies is a fast growing star in the country solar industry. It was set up in 1999 but has a rebirth at the hands of a new promoters in 2021. It boasts of the country's largest solar module manufacturing capacity of 12 GW and is a leader in the Engineering, Procurement, and Construction (EPC) business. EPC accounts for more than 98% of its revenue. Waaree Renewable works on projects for major companies such as Adani, Reliance, L&T, and NTPC.
The company's order book is also expanding fast. Value Research states that pending projects add up to 3,100 MWp in Q1 FY26, which marks a four-fold increase in two years. The company has a solid reputation in the EPC market and clients keep coming. With the government's increasing focus on renewable energy, the future of this company looks sunny indeed.
On October 31, the Waaree Renewable Technologies stock was quoting at Rs 1,242, down Rs 14.40 or 1.15%. Its stock has gained only 40% since its listing.
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