Multibagger Stock: Netweb Technologies advanced 147% in just 6 months, up 270% from IPO price

Netweb Technologies, a prominent provider of high-end computing solutions (HCS) in the country, continues its winning streak as its shares hit the 5% upper circuit limit for the second consecutive session on Friday, reaching ₹1852 apiece. This brings them close to their all-time high of ₹1892, with just a 2% difference. 

This surge in the stock price began after the company reported a strong set of numbers for the March ending quarter and for the full quarter of FY 24. The positive outcome has lifted investors' sentiment towards the company, driving the stock price higher.

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The company posted its highest-ever quarterly revenue of ₹269 crore, marking a remarkable growth of 116.5% over Q4 FY23. Additionally, it reported its highest-ever quarterly EBITDA of ₹44.4 crore, reflecting a surge of 170.6% over Q4 FY 23, with an EBITDA margin of 16.4%. 

Profit after tax also reached an all-time high of ₹29.7 crore, representing a significant increase of 181.8% over Q4 FY 23, with a PAT margin of 11.0%. In terms of full fiscal performance (FY24), the company reported its highest-ever revenue, EBITDA, and PAT at ₹7,36 crore, ₹114.4 crore, and ₹75.9 crore, respectively. 

In FY 24, the company partnered with NVIDIA as a select manufacturing OEM for the latest-gen AI systems to unlock the potential of AI and high-performance computing. Moreover, it launched Intel Sapphire Rapids & AMD Genoa-based ‘Make in India’ high-end computing servers.

Multibagger returns 

During the past six months, the shares have experienced a remarkable winning streak, surging from ₹749 apiece to the current trading price of ₹1852, reflecting a substantial gain of 147%. 

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The shares made their debut on the Indian stock exchanges in July last year, opening with an impressive 89.4% premium at ₹947 compared to the IPO price of ₹500 apiece. Considering the current market price, the stock is trading 270% higher than its IPO price.

Promoting outlook

Netweb Technologies is a prominent Indian-origin OEM specializing in high-performance computing systems (HCS). Their product range includes supercomputing systems, private cloud and hyper-converged infrastructure (HCI), data center servers, AI systems, enterprise workstations, and high-performance storage (HPS) solutions.

The company is known for developing indigenous compute and storage technologies. They deploy supercomputing infrastructure to address the growing computational needs of businesses, academia, and research organizations, especially through India's National Supercomputing Mission. Notably, three of their supercomputers have been featured 11 times in the world's top 500 supercomputers.

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Moving forward, with the widespread adoption of generative AI models and significant contributions from the global AI developer community in diverse and innovative use cases, India is on track to emerge as the AI factory of the world. This development presents promising opportunities for the expansion of the company's diverse product offerings.

The company's pipeline and order book continue to show strength. Ongoing improvements in its capabilities, alongside the expansion of its operations and product portfolio, position the company favorably for sustained growth while maintaining its technological leadership, as highlighted in the company's earnings report.

By the end of FY 24, the company's order book had surged exponentially to ₹4,11 crore, compared to ₹71.2 crore as of March 31st, 2023. Additionally, the company onboarded 171 new clients during FY 24. 

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Moreover, it is set to commission a state-of-the-art manufacturing facility equipped with the latest surface mount technology in Q1 FY25. In terms of segmental growth, income from AI Systems has increased approximately 2.6 times YoY in FY24 and now accounts for over 11% of the company's operating income.

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