What is the present value of Rs, 1,00,000 invested in MRF in the year 2000?

Madras Rubber Factory (MRF)

Image Source - Wikipedia

Madras Rubber Factory (MRF) is an Indian Multinational Tyre manufacturing company and the largest manufacturer of tyres in India. Also the sixth largest manufacturer in the world. It is headquartered in Chennai, Tamil Nadu, India.
The company manufactures rubber products including tyres, treads, tubes and conveyor belts, paints and toys. MRF also runs the MRF Pace Foundation, Chennai and MRF Challenge in Motorsport.

Madras Rubber Factory was started by K. M. Mammen Mappillai as a toy balloon manufacturing unit in 1946 at Tiruvottiyur, Madras (now Chennai). In 1952, the company ventured into the manufacture of tread rubber. Madras Rubber Factory limited was incorporated as a private company in November 1960 and ventured into manufacture of tyres in partnership with Mansfield Tire & Rubber company based in Ohio, United States. The company went public on 1 April 1961 and an office was established in Beirut, Lebanon to develop the export market in 1964 and its current logo of the muscleman was born. In 1967, it became the first Indian company to export tyres to USA.

In 1973, MRF started manufacturing Nylon tyres for the first time. MRF tyres supplied tyres to Maruti 800, India's first modern small car. In 1989, the company collaborated with Hasbro International, the world's largest toy maker and launched Funskool India. Also, they entered into a pact with Vapocure of Australia to manufacture polyurethane paint formulations and with Italian tyre manufacturer Pirelli for conveyor and elevator belt manufacture. During the year 2004–05, the product range of the company expanded with Go-kart & rally tyres and tyres for two/three wheeler's.

In the Year 2000 Invested in MRF

In August-2000 the share price of MRF was around 1,000/- rs per share. If let us say Ram has invested 1,00,000/- rs in MRF then he would have got 100 shares of MRF.

Present Market cap of MRF (As on 17th March 2021) is around 36,000 Cr. And MRF is fundamentally very strong company and till 2021 they did not provide any bonus shares, Splitting of shares and even they do not distribute dividend.

On 17th March 2021 each shares of MRF is trading at around 86,000/- rs.

If Ram holds those 100 shares of MRF which he brought in way back year 2000 then the present cost of that would be 86,00,000/- Rs.

Below Image shows Share price pattern of MRF since year 2000

MRF Share Price

In Just 21 years the invested money grown 86 times. 

In the Year 2000 Invested in Fixed Deposit

Let us assume Ram has opened a fixed deposit of 1,00,000/- Rs. in year 2000 and at at that time the rate of interest was around 13%. And we assume that the interest on that 1,00,000 rs has not been changed till 2021 and every year the interest is being compounded to give more returns.

In this case after 21 years Ram will get around 13 lac rs in return (13 times only).

See The difference and invest wisely


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