Hi-Tech Pipes Stock Soars 1765% in 4 Years, 150% in 2 Years – Should You Still Buy This Multibagger?

Many investors are now showing more interest in small-cap stocks, which often offer great returns. These stocks, like Hi-Tech Pipes, have caught the attention of people looking to benefit from rapid growth. While some small-cap stocks perform well, others can struggle to gain momentum in the market. Still, many investors believe that small-cap stocks will do well as companies invest more in their businesses.

Impressive Growth of Hi-Tech Pipes

Hi-Tech Pipes has been a standout performer, delivering huge returns to investors over the last few years. The stock price has gone up by 150% in just two years, rising from ₹82.3 to ₹205.24 per share. Over the past four years, the stock has surged by 1765%, climbing from ₹11 to its current price.

The company manufactures electric resistance welding (ERW) pipes and provides steel tubes and pipes for industries like infrastructure, telecommunications, defense, and real estate. Hi-Tech Pipes operates six manufacturing plants with a total capacity of 750,000 metric tons, and it sells its products across 17 states in India through more than 525 dealers.

Future Outlook: More Growth Ahead?

According to domestic brokerage firm Midas Equities, there’s still potential for the stock to rise further. The firm has an ‘accumulate’ rating on the stock and a target price of ₹296, which means it sees a 44% potential upside from the current price.

Midas Equities notes that Hi-Tech Pipes is well-positioned to benefit from the Indian government’s infrastructure projects. The company plans to double its production capacity and increase its value-added product (VAP) share. As India’s steel production is expected to grow, with structural steel tubes likely to rise from 9 million tons in FY23 to 17.3 million tons by FY30, Hi-Tech Pipes could see a lot of demand for its products.

Involvement in Key Projects

Hi-Tech Pipes is already playing a role in major infrastructure projects, such as the Noida International Airport, the world’s largest solar park in Khavda, and metro and borewell projects across various states. The company aims to increase its production capacity from 0.75 million tons in FY24 to 1 million tons by FY25 and eventually double it to 2 million tons in the next 4-5 years.

As the company continues to move towards producing more value-added products like GP and GI pipes, Midas expects the share of VAP in total revenue to rise significantly by FY28.

Financial Outlook

Hi-Tech Pipes is expected to see strong financial growth over the next few years. Midas projects that the company’s revenue will grow at an average rate of 27.9% from FY24 to FY28. It also expects Hi-Tech to achieve a profit of ₹443 crore by FY28, with earnings per share (EPS) growing at 45.1% per year during the same period.

With this promising outlook and Hi-Tech’s involvement in major projects, analysts believe that the company’s future looks bright, offering a good opportunity for investors looking for growth.