Penny stock under ₹15: Rama Steel Tubes share price soars 18% on renewable energy foray

Multibagger penny stock in focus today: Shares of Rama Steel Tubes, a leading manufacturer of branded steel products in India, spiked up 18.2% in intraday trade on Thursday, June 05, to hit a 5-month high of ₹13.84 apiece following its entry into the renewable energy segment by acquiring interest in a 225 MW PM-KUSUM solar power initiative.

In an exchange filing today, the company announced an updated strategic investment in the renewable energy space through its participation as a joint venture (JV) partner in a 225 MW solar power project under the Government of India’s ambitious PM-KUSUM

The project, structured under Onix IPP, a Special Purpose Vehicle (SPV), is spread across multiple locations in Maharashtra. It has successfully signed Power Purchase Agreements (PPAs) with the Maharashtra State Electricity Distribution Company Limited (MSEDCL) at a fixed tariff of ₹3.10 per unit for a 25-year term.

This investment marks RSTL's significant diversification into the clean energy space. The company said that the participation ensures stable long-term returns from the green and renewable energy sector. With its 10% stake in the SPV, the company will proportionally benefit from recurring income, adding a new dimension of sustainability-linked revenue to its business portfolio.

Eyes ₹270 crore in long-term gains from solar JV

As part of this venture, Rama Steel holds a 10% equity stake in Onix IPP. The project is expected to generate gross annual revenue of ₹108.11 crore, translating to a total revenue of ₹2,702.81 crore over the 25-year PPA period.

Based on its stake, RSTL is projected to earn ₹10.81 crore annually, resulting in a total share of ₹270.28 crore over the entire duration of the agreement.

Mr Richi Bansal, whole time director & chief executive officer, said, "we are proud to be part of this landmark renewable energy initiative. Our strategic investment in the 225 MW PM-KUSUM project not only strengthens our ESG profile but also diversifies our revenue base. This is a future-forward step aligned with India’s net-zero vision and rural empowerment.”

Earlier, the company entered the defence sector by incorporating Rama Defence Private Limited, which will engage in trading, importing, exporting, manufacturing, assembling, and supplying defence equipment, arms, ammunition, explosives, and related military and security hardware.

Wealth Creator

The company, which operates in the steel tubes and pipes manufacturing sector, has seen its shares skyrocket 177% in the last three years and 3,217% over the past five years. The company's shares have been trading ex-split in the ratio of 2:1 since March 2024.

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