Reliance-owned multibagger small-cap stock turns ₹1 lakh to ₹1.09 crore in five years

Multibager stock: The potential of multibagger stocks is like a beacon of hope in the world of investments. As Charlie Munger once said, the real money is not in the buying or selling but in the waiting. This principle holds true for penny stock investment, where the focus is on the long-term growth potential of a company, regardless of its size. If a company has the potential to grow rapidly, the size of its business becomes irrelevant. Similarly, if a stock shows promise, whether a small-cap, mid-cap, large-cap or even a penny stock, it's worth considering for investment.

To understand the potential of long-term stock market investments, let's delve into the journey of Lotus Chocolate Company shares. These shares have been a shining example of the multibagger stocks that the Indian stock market has produced in recent years.

In the year-to-date (YTD) period, the share price of Lotus Chocolate has skyrocketed from 303.50 to ₹1,766 on the BSE, marking an astounding 480 per cent rally in 2024. This Reliance Consumer-owned small-cap stock has a history of delivering exceptional returns to its shareholders. Over the last five years, this multibagger stock has surged from ₹16.20 to ₹1,766, delivering a staggering 10,800 per cent returns to its positional shareholders.

Lotus Chocolate's share price history

In one month, this Reliance-owned stock has risen from 1,452.80 to ₹1,766 apiece on the BSE, logging nearly 20 per cent rise in this period. In the last six months, Lotus Chocolate's share price has surged from around ₹325 to ₹1,766 per share, logging around a 450 per cent rise in this time horizon. In YTD time, this multibagger stock has delivered a 480 per cent return, whereas, in the last year, it has risen 460 per cent.

In the last five years, this Reliance Retail subsidiary-owned multibagger stock has risen from ₹16.20 to ₹1,766 apiece, delivering 10,800 per cent returns to its positional shareholders.

Impact on investment

Examining the share price history of Lotus Chocolate Company provides a clear picture of the potential wealth generation for investors. If an investor had put ₹1 lakh into this Reliance-owned multibagger stock a month ago, their investment would have grown to ₹1.20 lakh today. A similar investment six months ago would have turned into ₹5.50 lakh, and an investment at the beginning of 2024 would have grown to ₹5.80 lakh today.

Likewise, if an investor had invested ₹1 lakh in this multibagger stock one year ago, its ₹1 lakh would have surged to ₹5.60 lakh today. Similarly, if an investor had invested ₹1 lakh in this multibagger stock five years ago and had remained invested in the scrip throughout this period, its ₹1 lakh would have turned to ₹1.09 crore today.

Lotus Chocolate Company shareholding

As per the shareholding pattern for the April to June 2024 quarter, Lotus Chocolate Company Limited is majority-owned by Reliance Retail's subsidiary, Reliance Consumer Products Limited (RCPL), which holds a 51 per cent stake. This majority acquisition was completed in May 2023, with Reliance Consumer paying ₹74 crore for the stake.

"RCPL has also subscribed to non-cumulative redeemable preference shares of Lotus for an aggregate consideration of ₹25 crore. RCPL has also acquired equity shares pursuant to the open offer made under SEBI Takeover Regulations. RCPL has taken sole control of Lotus, effective May 24, 2023," Reliance Consumer had said at the time of the acquisition of Lotus Chocolate Company.

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