Shares of a small-cap company in the IT networking equipment and software sector jumped 3 percent on Tuesday morning following the announcement of plans to expand its capacity by 6,000 KW over the next five years.
Meanwhile, another small-cap stock involved in manufacturing and trading luggage also saw a 3 percent increase after commencing commercial production at its new greenfield facility.
Price Movement
On Tuesday, E2E Networks Ltd’s share price rose 2.8 percent, reaching an intra-day high of Rs.4,544.00, up from the previous close of Rs.4,421.35. Similarly, Safari Industries (India) Ltd saw its shares climb 2.8 percent, hitting an intra-day peak of Rs.2,681.65, up from Rs.2,607.00 per share.
What Happened
E2E Networks Ltd currently has a capacity of 4,200 KW, with utilization ranging from approximately 40 percent to 60 percent. The company plans to increase its capacity by 6,000 KW over the next five years.
The required investment will vary depending on the actual service utilization. To finance this expansion, the company intends to use a combination of internal accruals and funds raised through a preferential issue of equity shares. This capacity expansion is aimed at meeting the growing demand for the company’s GPU and other services.
Safari Manufacturing Limited, a wholly owned subsidiary of the Company, has officially begun its commercial production of luggage on 2nd December 2024, following the successful completion of trial runs.
The production is taking place at the newly established greenfield manufacturing facility located in Jaipur, Rajasthan.
Financial Performance
For the quarter ending September 2024, E2E Networks Ltd reported operational revenue of Rs.48 crore, reflecting a 118 percent increase from Rs.22 crore in Q1 FY24. Net profits grew to Rs.12 crore, representing a 100 percent rise from Rs.6 crore during the same period.
According to its latest financial update, Safari Industries (India) Ltd reported net sales of Rs.458 crore for Q2 FY25, indicating a 21 percent increase from Rs.370 crore in Q2 FY24. However, net profit fell 25 percent to Rs.30 crore, from Rs.40 crore during the same period.
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Shareholding Pattern
As per the September 2024 shareholding pattern, promoters hold a 51.56 percent stake in E2E Networks, while Foreign Institutional Investors (FIIs) own 3.39 percent, Domestic Institutional Investors (DIIs) hold 4.11 percent, and retail investors possess 40.83 percent. Ace investor Ashish Rameshchandra Kacholia holds 1,77,043 equity shares, amounting to 1.05 percent of the company.
In the case of Safari Industries, promoters own 45.41 percent as of September 2024. Foreign Institutional Investors (FIIs) hold 12.24 percent, Domestic Institutional Investors (DIIs) own 22.73 percent, and retail investors control 19.60 percent. Ashish Kacholia also holds a 1.84 percent stake in the company.
About the Company
E2E Networks specializes in offering CPU and GPU-based cloud computing platforms that enable customers to perform large-scale general and AI workloads, benefiting from its partnership with NVIDIA. The company has formed strategic alliances with leading OEMs such as NVIDIA, Intel, AMD, Microsoft, and Dell.
Safari Industries (India) Ltd is a key player in the luggage manufacturing industry. The company focuses on producing both hard and soft luggage, with its hard luggage primarily made from materials such as Polypropylene (PP) and Polycarbonate (PC) at its plant in Halol, Gujarat. Soft luggage is typically made from a range of imported fabrics.
Written by – Siddesh S Raskar
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