Down 60% from peak! This multibagger stock looks ready to make a comeback. Time to buy?

Multibagger small cap stock: Maintaining their losing streak for the second straight day, shares of Mold-Tek Technologies tumbled another 4% in intraday trade on March 11, reaching ₹444.65. The stock, which saw a one-way surge between April 2020 and July 2023—resulting in a 467% gain—began declining in the following months and has remained in a downtrend to date, losing 58% of its value in 19 months.

The stock has ended the last seven months in the red, with February seeing the sharpest drop of 17%, followed by January with a 14% decline. Despite the steep fall, the stock remains up 137% over the last five years.

The company is one of the key players in rigid plastic packaging in India, specializing in manufacturing injection-molded containers for lubricants, paints, food, and other products. It operates ten processing plants and two stock points across India to ensure faster supply. According to its website, Mold-Tek has a massive injection molding capacity of approximately 50,000 TPA.

Axis Securities upgrades stock to 'buy'

Domestic brokerage firm Axis Securities, in its latest note, upgraded its rating on the stock to 'Buy' from 'Hold' and maintained its target price at ₹600, indicating an upside of 30% from the stock's current trading price.

"We continue to value the stock at 18x FY27E earnings and maintain our target price of ₹600 per share. This implies an upside of 30% from the current market price (CMP), with an attractive valuation post the recent price correction," said Axis Securities.

Axis Securities' positive stance follows its visit to Mold-Tek Packaging’s plants (Unit 1 and Unit 10) in Hyderabad, where it interacted with the management. The company provided insights into its ongoing expansion, cost-saving initiatives, and near- to medium-term growth plans.

According to the brokerage, the company is expanding its IML (In-Mold Labeling) printing capacity by 40% in Q4FY25 to meet rising demand. It also noted that Mold-Tek remains the only packaging company in India that designs and manufactures injection moulds and custom robots for IML decoration while also producing IML labels in-house.

The company’s exports are gaining momentum, with sales in the past nine months doubling year-on-year (YoY).

Mold-Tek has invested ₹10 crore in a new plant and machinery over the last few months to build capacity dedicated to Aditya Birla Group’s (ABG) paint business, with an additional ₹5 crore planned for future investments.

The brokerage underscored that rising demand for pharma packaging presents a strong growth opportunity for Mold-Tek’s expansion into this large sector. Additionally, with the new U.S. government imposing duties on China, export opportunities to neighboring countries are expected to increase.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.