Safari Industries Limited saw a significant uptick in its share price on Tuesday, December 3, 2024. The company’s stock surged by 3.01%, reaching an intraday high of ₹2,675 per share. This rise was attributed to the announcement that Safari Manufacturing Limited, a wholly-owned subsidiary of Safari Industries, has successfully commenced commercial production at its new greenfield manufacturing facility in Jaipur, Rajasthan.
Expansion into Jaipur fuels share price growth
The increase in share price followed an official announcement from Safari Industries. The company revealed that, after completing trial runs, Safari Manufacturing Limited officially began the production of luggage on December 2, 2024. This new manufacturing unit marks an important milestone for the company, further strengthening its operations in the competitive luggage manufacturing sector.
For those looking to invest in stocks, this development is a positive indicator of the company’s growth trajectory. The Jaipur facility is expected to enhance production capabilities and support Safari Industries’ expansion plans, which could have a favourable impact on its future financial performance.
Financial performance in Q2FY25
In its recent financial results, Safari Industries reported a 25.4% decrease in its consolidated net profit for Q2FY25, falling to ₹29.7 crore compared to ₹39.8 crore in the same quarter the previous year. Despite the decline in profit, the company saw a 23.7% year-on-year increase in its revenue from operations, which amounted to ₹457.8 crore.
The company’s profit before tax also saw a notable drop, declining by over 27% to ₹37.8 crore in Q2FY25, down from ₹51.9 crore in Q2FY24. These figures suggest that while revenue growth is strong, there are ongoing challenges in profitability. However, for those interested in how to invest in stocks, it’s important to consider both the revenue growth and the long-term strategic expansions that may offset short-term profitability concerns.
Interim dividend declared amidst mixed results
Safari Industries also declared an interim dividend of ₹1.50 per share for FY25, which will be paid on or before December 6, 2024. Despite the mixed financial results, the decision to issue a dividend is a positive signal to investors, showcasing the company’s commitment to rewarding shareholders.
If you are looking to invest in stocks that provide steady returns, Safari Industries could be an option, given its consistent dividend payouts alongside its expansion efforts.
A look at Safari Industries: A leading brand in the luggage sector
Founded in 1974, Safari Industries has grown into a leading player in the Indian luggage and accessories market. The company offers a wide range of products, including both hard and soft luggage, lightweight options, TSA-approved designs, casual backpacks, and laptop bags. Operating under well-established brands such as Safari, MAGNUM, GENiUS, and Genie, Safari Industries caters to diverse customer needs, from daily commuters to frequent travellers.
With a well-established presence in the market, Safari Industries operates a manufacturing facility in Halol, Gujarat, where it produces its hard luggage. The soft luggage line, on the other hand, is primarily imported. The company also boasts a strong distribution network, with over 9,300 customer touchpoints across retail outlets, e-commerce platforms, and institutional sales channels. This extensive reach ensures that Safari Industries remains a prominent name in the industry.
Market performance and investment outlook
As of the latest data, Safari Industries has a market capitalisation of ₹12,850.66 crore and is categorised under the BSE SmallCap index. With a 52-week high of ₹2,712.05 per share and a low of ₹1,627.40, the stock has shown a relatively stable performance within this range. Currently, it is trading at ₹2,628.70 per share, a 1.23% increase from the previous trading session.
For investors looking to invest in stocks with potential for growth, Safari Industries presents a compelling case. The new manufacturing facility in Jaipur could drive increased production, contributing to long-term financial growth. Moreover, the company’s solid product offerings and wide distribution network suggest continued market relevance.
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