High ROE & High ROCE Multibagger Stock: Industrial Manufacturing Company Signs NBIO for Strategic Acquisition in the Machinery Segment

DSIJ Intelligence-1 / 25 Jul 2025/ Categories: Multibaggers, Trending

High ROE & High ROCE Multibagger Stock: Industrial Manufacturing Company Signs NBIO for Strategic Acquisition in the Machinery Segment

The stock gave multibagger returns of 540 per cent in just 2 years, 760 per cent in 3 years and a whopping 3,300 per cent in 5 years.

Rajoo Engineers Limited announced that it has signed a Non-Binding Indicative Offer (NBIO) for the acquisition of a machinery manufacturing company. The target company boasts a three-decade legacy and a strong presence in both domestic and international markets, specialising in machines for various industries. This strategic move aligns with Rajoo Engineers' vision for inorganic growth through forward integration.

This potential acquisition is expected to create significant synergies, allowing Rajoo Engineers to offer end-to-end solutions to its customers. The combined strengths of both companies will not only enhance product offerings but also significantly expand their footprint in both Indian and global markets. Rajoo Engineers Limited has committed to keeping all stakeholders informed of further developments under applicable regulations.

Additionally, the company successfully raised Rs 160 crore through a Qualified Institutional Placement (QIP) that closed on July 21, 2025. The QIP, which involved issuing 1,46,78,900 equity shares at Rs 109 each, garnered significant interest from both domestic and international institutional investors, including major participants like Morgan Stanley Asia (Singapore) and HDFC Bank Limited. This strong response underscores investor confidence in the company's growth strategy, with the proceeds earmarked for strategic acquisitions aimed at expanding scale, product offerings, and market presence, ultimately enhancing Rajoo's overall growth trajectory.

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About the Company

Rajoo Engineers Limited, established in 1986 and based in Rajkot, Gujarat, has grown into a global leader in plastic extrusion machinery. With over 38 years of experience, the company specialises in Blown Film Lines, Sheet Extrusion Lines, Thermoforming Machines, and PVC Pipe Extrusion Solutions. Rajoo Engineers offers over 26 products across six segments, serving customers in more than 70 countries. Their strong focus on innovation, energy efficiency, and high automation has positioned their products to compete with global leaders, reinforcing their market credibility as a publicly listed company on both the BSE and NSE.

According to consolidated Quarterly Results, the net sales increased by 6.1 per cent to Rs 56.81 crore, operating profit increased by 27.5 per cent to Rs 9.14 crore and net profit increased by 47.7 per cent to Rs 7.93 crore in Q2FY25 compared to Q2FY24. In its annual results, the net sales increased by 23.5 per cent to Rs 197.35 crore, operating profit increased by 42.4 per cent to Rs 30.62 crore and net profit skyrocketed by 96.8 per cent to Rs 19.71 crore in FY24 over FY23.

The company has a market cap of over Rs 2,000 crore and as of March 2025, it is almost debt-free. The company has delivered good profit growth of 91 per cent CAGR over the last 5 years and working capital requirements have reduced from 39.7 days to 12.7 days with debtor days have improved from 29.6 to 21.7 days. The stock gave multibagger returns of 540 per cent in just 2 years, 760 per cent in 3 years and a whopping 3,300 per cent in 5 years. The shares of the company have an ROE of 27 per cent and an ROCE of 33 per cent.

Disclaimer: The article is for informational purposes only and not investment advice.