Wendt (India) loses big

Wendt (India) is a big loser today, going down over 8% a few minutes after opening bell to Rs.2451. It has recovered from there but remains around 5% down at Rs.2550.

 Abrasives and precision component maker Wendt India, a Rs.10 face value stock quoted at over Rs.2500, market cap of around Rs.515 crore, debt free, with a consistent dividend paying track record, as such does not look like a small cap stock. But its earnings drive home that point.

The company had a disappointing Q1FY18 performance. Its consolidated revenue fell 2% to Rs.35 crore and net profit slipped 37% to Rs.2.2 crore. EBITDA came in at Rs.5 crore, down 28% and margins slipped from 19.3% to 14.2%.

Its equity capital is tiny at Rs.2 crore, explaining why it is ‘small cap’ and reserve is over Rs.110 crore.