In the Indian stock market, some hidden gems quietly deliver impressive returns to early investors, flying under the radar while building strong fundamentals. These lesser-known companies often operate in niche segments, steadily growing their market presence and profitability. In our latest blog, we spotlight two such emerging players — PG Electroplast Ltd. and Transformers & Rectifiers Ltd. Both firms have shown consistent momentum and are strategically positioned to capitalize on future growth opportunities, making them worth watching.
Chapter 1. The Start of PG Electroplast
PG Electroplast Ltd. started as a company that made electronics for other brands. It quietly worked behind the scenes, making things like TVs and refrigerators for big names.
In 2020, not many people knew about PG Electroplast. But the company saw a chance to grow when the government launched a program to encourage local manufacturing. PG Electroplast decided to start making more parts in-house, like plastic and circuit boards. This move helped reduce costs and increase profits.
By FY24, PG Electroplast’s revenue had reached ₹27.5 billion and in 9M FY25 net profit surged to ₹1.4 billion. It may not sound huge, but just three years earlier, the company was struggling to make a profit. This shows how much it has grown in a short time.
1.1. The Growing Electronics Market
India’s demand for electronics is growing fast. More people are buying products like TVs, washing machines, and air conditioners. By 2025, India will be one of the largest markets for these products in the world.
PG Electroplast is well-positioned to take advantage of this. It works in many areas, like air conditioners, washing machines, and mobile phone parts. The company also helps design and make the products, which gives it more control over quality and costs.
What makes PG Electroplast even more exciting is its focus on research and development (R&D) and building new factories. The company is investing in automation to meet the growing demand. This strategy has worked well, as its stock has increased tremendously in the past three years.
3 Year Growth Overview:
Chapter 2: The Comeback of Transformers & Rectifiers
Now, let’s look at Transformers & Rectifiers Ltd. This company has had a different journey. It makes power transformers — big machines used in power grids.
For many years, Transformers & Rectifiers struggled with low demand and small profits. The power sector, which it depended on, wasn’t very exciting. The company needed a lot of money to run, and its customers were mostly government projects.
But things have changed. The Indian government has started focusing on renewable energy and expanding the electricity grid, especially in rural areas. This has increased the demand for transformers, and Transformers & Rectifiers has benefitted from this change.
In FY25, the company reported ₹19.9 billion in revenue and ₹1.8 billion in profit. This was a big improvement from its earlier losses. The company also has an order book worth over ₹5,132 crore, ensuring it will keep growing for years to come.
2.1. Government Support and Increased Demand
Why is Transformers & Rectifiers growing?
First, the government is supporting the local manufacturing of electrical equipment. Second, the power sector is changing, with new projects and the need for better power infrastructure.
The shift to renewable energy, like solar and wind power, also requires new transformers to manage the electricity. Transformers & Rectifiers, with its experience and large factories, is in a great position to meet this demand.
The company’s stock price, which was below ₹5 during the pandemic, is now over ₹500. This is a 100x return in just a few years, and many believe this is just the beginning.
Chapter 3. What Makes a Multibagger?
So, What’s the common thread between these two standout performers?
- Growing Markets: Both PG Electroplast and Transformers & Rectifiers are in industries that are growing fast.
- Supportive Trends: Both are benefiting from larger trends. PG Electroplast is growing with the electronics market, and Transformers & Rectifiers is growing with the power sector.
- Strong Leadership: Both companies are led by people who have a long-term vision and are investing in the future.
- Improving Finances: Both companies are earning more, making bigger profits, and becoming stronger financially.
Chapter 4: The Risks Ahead
No investment is without risk.
PG Electroplast faces tough competition in the electronics market. Even though its business model gives it higher profits, it needs to keep improving and maintaining quality. Also, demand for electronics can drop if the economy slows down.
Transformers & Rectifiers faces risks from changing prices of raw materials and delays in government projects. Changes in power sector policies could also affect its business.
As both companies’ stock prices rise, expectations also go up. If anything goes wrong, stock prices could drop.
Chapter 5: Looking Ahead
Despite the risks, the future looks good for both companies.
PG Electroplast is exploring new areas like electric vehicle components and mobile accessories, which have a lot of potential. The company is also spreading its business across different products, so it doesn’t depend on just one area. As people demand more energy-efficient products, PG Electroplast is in a good position to succeed.
Transformers & Rectifiers is improving its operations and expanding its factories. The company is also looking for opportunities to export products with higher profit margins. The growth of India’s power sector will continue to drive demand for its products.
Epilogue: The Next Big Winners
Investing in multibaggers is about being patient and seeing the potential early. PG Electroplast and Transformers & Rectifiers may not be well-known now, but they have a lot of potential for the future.
As India continues to grow, companies that support manufacturing and power infrastructure will be very important. These two companies are well-positioned to benefit from that growth. Their strong leadership and focus on the future make them worth watching, and maybe even investing in.
