Why This Smallcap Stock Surged to a 20% Upper Circuit

Shares of Johnson Controls – Hitachi Air Conditioning India surged by 20 percent, hitting a fresh 52-week high of Rs 1,486 per share on May 24, following a robust performance in the January-March quarter (Q4FY24).

Year-to-date, Johnson Controls’ shares have soared over 33 percent, significantly outperforming the Nifty 50 index, which rose by just 5 percent.

Currently, Johnson Controls’ shares trade at the lowest price-to-book (PB) ratio of 5.11x compared to its peers: Voltas at 7.33x, Bluestar at 12x, and Amber Enterprises at 6x, according to data.

In Q4FY24, Johnson Controls reported a 50 percent year-on-year (YoY) increase in revenue from operations, reaching Rs 771 crore, up from Rs 547 crore in the same period last year. The company posted a profit of Rs 48 crore, a significant turnaround from the Rs 1 crore loss in Q4FY23. Revenue from cooling products for comfort and commercial use climbed 41 percent YoY to Rs 760 crore, while revenue from design and development services declined slightly by 1 percent to Rs 178 crore.

Total expenses for Johnson Controls grew by 30 percent YoY to Rs 707 crore in Q4FY24, up from Rs 545 crore in the previous year.

Johnson Controls, widely recognized as Hitachi, manufactures a range of electronic home solutions, including window ACs, split ACs, tower and packaged air conditioners, 2- and 3-door refrigerators, and fully automatic washing machines.

During the January-March period, foreign institutional investors increased their stake to 0.5 percent, up from 0.4 percent in the previous quarter. However, mutual funds reduced their stake to 8.1 percent from 8.5 percent, and institutional investors also decreased their stake to 8.9 percent from 9.3 percent in the same period.

These developments have attracted significant attention in the stock market, highlighting Johnson Controls’ strong performance and growth prospects in the finance and business sectors.