250% return in five years! BMW Industries shares zoom almost 9% after ₹800 crore CAPEX expenditure update

BMW Industries shares surged by nearly 9 percent during intra-day trading on Thursday, March 20, following the company’s announcement of a significant capital expenditure (capex) plan worth ₹800 crore. The multibagger stock, which has delivered a remarkable 250 percent return over the past five years, gained traction after the company revealed its plans to establish a greenfield downstream steel complex in Bokaro, Jharkhand.

"The Board of Directors of BMW Industries Limited (“the Company”) at its meeting held today has approved capital expenditure (Capex) of ₹803.47 crore for the establishment of a Green-field Downstream Steel Complex at Bokaro, Jharkhand. The project will be funded through a mix of Internal Accruals and Debt," the company said in an exchange filing.

BMW Industries Unveils ₹800 Crore Capex Plan

BMW Industries informed the exchanges it is planning to expand its business by establishing a manufacturing plant in Bokaro, in the state of Jharkhand, which is the second-highest steel-producing state in the country. The proposed project involves the development of a Downstream Steel Complex with an annual production capacity of 300,000 TPA of Cold Rolled Full Hard Coil/Sheet; 540,000 TPA of Galvanized Coil/Sheet, and 200,000 TPA of Color Coated Coils/Sheets. The project will be located at Bokaro, Jharkhand, said the company.

As per the press release, the total project cost is estimated at Rs. 803.47 crore, which will be funded through a mix of Internal Accruals and Debt. The Company already possesses the required land, which is designated for industrial use and will serve as the site for this greenfield project, it added.

The company further noted that it already owns the required industrial land for the project. The first phase of operations is expected to commence in FY26, with the plant becoming fully operational in stages over the following two years.

Strategic Benefits of the Expansion

The company highlighted several strategic advantages of the project. The Bokaro facility, located approximately 300 km from Haldia/Kolkata port, will provide direct access to export markets, boosting the company's global reach. Additionally, its proximity to raw material sources will enhance supply chain efficiency.

The Bokaro Industrial Area, being a well-established industrial hub, offers ample infrastructure and resource availability, which will aid the smooth execution and operation of the project. BMW Industries believes this expansion will strengthen its foothold in the downstream steel processing sector and create long-term value for its stakeholders.

Stock Performance and Market Trend

Following the announcement, BMW Industries' share price surged by 8.7 percent to hit an intra-day high of ₹48. Despite the recent spike, the stock remains around 39 percent below its 52-week high of ₹79.05, which it touched in August 2024. However, it has advanced 22 percent from its 52-week low of ₹39.36, recorded just a week ago on March 13.

Over the past year, the stock has shed 21 percent. It has also lost over 5 percent in March so far, following a 12.5 percent decline in February. However, it had gained 4.5 percent in January, indicating a mixed performance in recent months.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.