MRF Makes History as First Indian Stock to Reach ₹1 Lakh per Share Milestone
MRF, a prominent player in the Indian stock market, achieved a remarkable feat on Tuesday, June 13, by becoming the first stock to surpass the significant milestone of ₹1 lakh per share. Beginning the day at ₹99,500 on BSE, an increase from the previous closing price of ₹98,939.70, MRF soared to an all-time high of ₹1,00,300 during morning trade.
Over the past year, MRF has experienced substantial gains, outperforming the benchmark Sensex with a 45% increase compared to the latter’s 19% growth. On June 17, 2022, MRF shares hit their lowest point in 52 weeks, reaching ₹65,900.05 on BSE. Since then, the stock has risen by an impressive 50%.
The recent surge in MRF’s stock price can be attributed to the company’s strong financial performance in the March quarter and improved prospects of profitability resulting from a decline in raw material prices.
During the fourth quarter ending in March 2023, MRF’s consolidated profit after tax (PAT) stood at ₹313.53 crore, marking an 86% year-on-year (YoY) increase from the net profit of ₹168.53 crore achieved in the corresponding quarter of FY22. Additionally, the company’s consolidated revenue from operations in the same quarter of FY23 amounted to ₹5,841.7 crore, reflecting a YoY rise of 10.12% compared to ₹5,304.8 crore in the fourth quarter of FY22.
While MRF’s net expenses during Q4FY23 totaled ₹5,410.26 crore, an increase from ₹5,142.79 crore in Q4FY22, the earnings per share (EPS) for the quarter under review rose to ₹803.26, surpassing the ₹389.55 recorded in the same quarter of the previous year.
Financial experts find MRF’s fundamentals appealing, recommending the stock for long-term investments for those with the necessary financial means. However, considering the stock’s rich valuation and recent significant gains, it is prudent to anticipate some profit booking in the near future.
Analysts highlight MRF’s robust balance sheet and diversified revenue streams across various segments, reducing its vulnerability to slowdowns in specific sectors. Consequently, investors with substantial resources may find MRF an attractive option for long-term investment. Moreover, indications suggest that the stock retains short-term potential.
Santosh Meena, Head of Research at Swastika Investmart, stated, “MRF, a leading stock in the Indian market, has created history by surpassing the remarkable milestone of ₹1 lakh. Technical chart analysis reveals a breakout pattern known as a classical flag formation, suggesting continued upward momentum for the stock, with a potential target of approximately ₹1,10,000.” Meena further added, “It’s worth noting that even if there are temporary pullbacks, the previous breakout level of ₹95,000 is expected to provide robust support, acting as a solid foundation for the stock.”
Madras Rubber Factory (MRF), also referred to as MRF Tyres, is an esteemed multinational company based in Chennai, Tamil Nadu, India. It holds the distinction of being the largest tire manufacturer in the country, boasting a significant presence in the Indian market.
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