Rajesh Exports bags order worth Rs 1,122 crore from UAE ; stock rises 4 percent

Jewellery firm Rajesh Exports has bagged an export order worth Rs 1,122 crores of designer range of gold and diamond studded jewellery and medallions from UAE said the company in an exchange filing to the Bombay Stock Exchange. According to the company the order is to be completed by 31st March 2016 and it will be executed at the company's manufacturing facility at Bengaluru.

The company is confident of completing this order within the time frame, leveraging on its expertise, skilled craftsmen & artisans and its exceptionally strong backward integration infrastructure.

Reacting to this positive development the company's scrip rose more than 4 percent in trades before closing at Rs 708.05. The Company touched an intra-day high of Rs 714. Over the past 3 months the company's stock has been on an upward trajectory indicative by the fact that it has outperformed the broader market by giving handsome returns of 63 percent as against Sensex's 0.39% decline. The stock had outperformed the market over the past one month, rising more then 11 percent compared with 4.13 percent decline in the Sensex.The stock price movement has been justified by the strong financial performance reported by the company.

The Company posted a strong set of Q2FY16 numbers which were boosted by the integration of Valcambi.The company reported revenue of Rs 44,319.65 crores from Rs 10959.43 Y-O-Y. The Company's EBITDA came in at Rs 471.41 crores from Rs 262.36 crores which was a multifold jump. The Company was also successful in increasing their EBITDA margins by 134 basis points. Reported PAT was of Rs 279.84 crores from Rs 159.77 crores. The EPS has also seen a substantial jump of 75 percent due to a EPS accretive acquisition.

The above numbers are not comparable as they also inclue the financials of Valcambi which was acquired by the company in Q2FY'16.Valcambi is a Switzerland based refiner and is reputed to be the world's largest precious metal refiner.

The Company's future outlook looks quite strong given the acquisiton of Valcambi which would add up to the already existing expertise in the gold jewellery business by giving the company global footprint and also enhancing Rajesh Export as a truly global company by making it the largest gold company in the world.

Rajesh Exports Limited is an India-based company, which is involved in the business of gold and gold products. The Company is engaged in the manufacture of gold jewelry, gold products and sale of bullion. It is a gold refiner and manufacturer of all kinds of gold jewelry, coins and medallions. The company is currently the single largest constituent of gold business in the world.

The promoters holding in the company stood at 53.89 per cent while institutions and non-institutions held 20.09 per cent and 26.02 per cent, respectively.