Porinju Veliyath Foresees More Multibagger Gains From Latest Micro-cap Stock Pick

Porinju Veliyath never tires of talking about Samtex Fashions, a micro-cap with a market capitalisation of about Rs. 100 crore. In an interview to ET, Porinju oozed confidence about the prospects of companies like Samtex. “I am seeing many potential multibaggers and when I look for values, I am still more convinced that the value is lying in the midcap and the small cap segment” he said.

Porinju later tweeted about the stock:

(Samtex Fashions, I suggested on @ETNowTv last Friday is on 5th day circuit. Look cons. nos. There are 100s of such potential multi-baggers!)

Porinju was in fact a major shareholder in Samtex Fashions earlier. As of 30th June 2011, he held 117,000 shares. His name, however, does not appear in the present list of major shareholders.

Samtex has been on fire in the recent past. On a YOY basis, it has given a stupendous return of 225%. The two year return is an incredible 607%.

The million dollar question is whether after such a scorching performance, Samtex has the potential to offer more gains?

Porinju obviously believes that it has that potential. Today, he scooped up a chunk of 77,473 at Rs. 70 each, making an investment of Rs. 54 lakhs.

Porinju’s logic appears to be that Samtex Fashions is walking on the same path as its illustrious peers, Arvind, Page Industries, Kitex Garments, Indian Terrain, Ashapura Intimates etc and that there are mega gains to be made from such stocks.

Only time will tell whether Porinju is right in his theory or not.