This stock has rallied over 200% in last 3 months, should you invest?

Investors are always looking for stocks that have given multibagger rewards and do have the potential to give robust returns in the future as well. In Money9’s exclusive show Get Rich, Sakshi Batra and Rahul Oberoi discuss this stock that has given over 200% return in the last 3 months. This stock has hit an upper circuit throughout the week, even today it is at a 5% upper circuit.

Globus Spirits is a small-cap liquor company, which was established in 1992. It is the largest grain-based ENA manufacturer in India with a capacity of 160 million litres. It is one of the leading players in the Indian alcoholic beverages industry. It is engaged in manufacturing, marketing, sale of IML, IMFL and contract bottling. The company’s share price has rallied 186% in just 3 months. The Sensex had also advanced 12% during the same period. It has delivered more than 779% return in two years against 48% by Sensex. The investment of Rs 25,000 turned to around Rs 2.220 lakh in 2 years. It has shown a strong earning visibility.

Factors

– PAT registered 198% growth to Rs 55.7 crore in Q1

– Nearing net-debt free status with return ratios improving

– Increasing demand for ethanol, scale-up of the consumer business to support earnings

– GSL’s total capacity will be 300 million litres pa on completion of expansion projects

– 75% of expanded capacity will be utilised to manufacture ethanol, 25% to manufacture alcohol for the consumer business