Refex Industries: this Indian stock has delivered 11,000% returns over a decade

on Jun 9, 2024
  • Refex Industries shares have soared by 11,000% in the past 10 years.
  • Strategic diversification into new business areas has driven significant growth.
  • The company reported a total income of ₹1,388.84 crore for FY24, with an EBITDA of ₹148.75 crore.

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Shares of Indian refrigerant gas manufacturer Refex Industries (NSE: REFEX) have provided an astonishing 11,000% return over the past 10 years.

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This impressive performance has seen the stock price soar from around ₹1.37 per share a decade ago to ₹151.8 per share as of Friday.

This means that an investment of ₹1 lakh in Refex Industries 10 years ago would now be worth more than ₹1 crore.

Refex Industries: a brief history

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Refex Industries, formerly known as Refex Refrigerant Ltd, was founded in 2002.

Initially, the company was engaged in the business of refilling non-ozone depleting refrigerant gases, known as hydrofluorocarbons (HFCs), which are used in air conditioners, refrigerators, and refrigerating equipment.

The company launched its public offer in July 2007 and got listed on the Bombay Stock Exchange (BSE), with a total turnover of ₹51.41 crore for the year ended March 31, 2007.

Strategic diversification and growth

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In 2018, Refex Industries ventured into fly ash and coal handling services for thermal power plants.

This strategic move saw the stock price grow approximately 21 times to ₹30 per share.

Continuing its diversification, the small-cap company entered the power-trading business in 2022 and set up a green mobility business in 2023.

This broadening of business operations has been a key factor in the company’s impressive 11,000% return over the past decade.

Financial performance and operations

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Refex Industries currently operates refilling facilities in Chennai and Tamil Nadu, with additional warehouses in Delhi and Mumbai.

For the March quarter of 2023-24, the company reported a total income of ₹345.7 crore. The total income for the full fiscal year was ₹1,388.84 crore.

The company’s EBITDA for the last quarter of FY24 was ₹43.5 crore, with an EBITDA margin of 12.89%.

For the entire fiscal year, the EBITDA amounted to ₹148.75 crore, achieving a margin of 10.85%.

The company’s Profit After Tax (PAT) for the March quarter was ₹35.76 crore, while the full fiscal year PAT reached ₹100.95 crore, reflecting a PAT margin of 7.27%.

Promoters hold a majority stake of 55.3% in Refex Industries, with public shareholders owning the remaining 44.7%.

What’s driving the growth?

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Refex Industries’ diversification into new business areas such as fly ash and coal handling services, power trading, and green mobility has significantly contributed to its extraordinary growth.

Additionally, the company’s focus on supplying environment-friendly HFC refrigerant gases has positioned it as a leading player in this sector in India.

The strategic expansion and diversification have not only boosted the company’s revenue and profitability but have also enhanced its market position.

This multifaceted approach has enabled Refex Industries to capitalize on emerging opportunities and drive substantial shareholder value.

Future prospects

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Looking ahead, Refex Industries is well-positioned to continue its growth trajectory.

The company’s ability to adapt and diversify its business operations has been a critical factor in its success.

As it continues to explore new opportunities and expand its market presence, Refex Industries is likely to remain a strong performer in the Indian stock market.

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