One South African company quadrupled shareholders’ money in five years

Industrial manufacturer and steel trader Argent Industrial has experienced a strong share price performance over the past five years, as the company’s efforts to transform its business operations have paid off.

Since 2020, Argent Industrial’s share price has increased by over 460%, primarily driven by its consecutive strong results and strategic approach to portfolio diversification.

Argent is a steel-based beneficiation group with an extensive portfolio of businesses, including international brands. The company operates 24 units across South Africa, the United Kingdom, and the United States.

Some of its businesses include American Shutters, Argent Industrial Engineering, Argent Industrial Investments, Castor and Ladder, Gammid Group, Hendor Mining Supplies, Jetmaster, and Koch’s Cut and Supply Steel Centre.

These businesses cover a vast spectrum of products, ranging from manufacturing and steel-based trading to concrete building products, mobile and static bunded fuel storage and dispensing systems, and bespoke trolleys, with regional outlets that trade in several of these products.

Argent was listed on the JSE in 1994, when its name was still Scharrig Industrial Holdings.

Argent was born out of Scharrig Mining, which created Scharrig Industrial Holdings to hold the group’s industrial investments. 

The company changed its name to Argent Industrial in 1999 and was primarily focused on supporting the mining industry through the construction of tipper trucks and the refurbishment of engines. 

However, following the name change in 1999, the group diversified into steel trading and manufacturing by acquiring several businesses, including Phoenix Steel, Hendor Mining and Jetmaster in 2003.

It is this diversification that the group attributes its strong financial position over the past few years to. Argent’s revenue, earnings and net asset value have grown every year since 2020.

The company attributes its consistently strong performance to its widely diversified portfolio, which shields it from many of the challenges faced by the manufacturing sector.

“Manufacturing is the biggest activity of the group, and this, together with a strategy of vertical integration and being self-sufficient, has led the group to being totally diversified,” it explained.

“This protects the group from economic swings in any one segment of the market and is a catalyst for new growth opportunities.”

Argent’s consistently strong financial performance can be seen in the graphs below.

Argent’s investment case

In its latest results for the year ended 31 March 2025, the company reported a strong performance.

In 2025, Argent recorded revenue of R2.64 billion, a 3.59% increase from R2.54 billion the previous year. Its net asset value increased from 3,115.4 cents per share to 3,488.1 cents, up 12%.

Despite its strong performance over the past five years, Argent shareholders have only received dividend payments since 2023.

However, Argent’s dividend payout has grown significantly since then. In 2023, it declared a dividend of 87 cents per share, 2024’s dividend was 105 cents, while 2025’s was 120 cents.

Argent’s strong financial performance has been rewarded with substantial share price growth over the past five years.

Since 1996, Argent’s share price has increased by approximately 446%, with a significant portion of this growth occurring over the past five years. 

Between 1996 and 2020, Argent’s share was relatively flat, aside from a big jump from around 2004 to 2008.

However, the company has turned this around over the past five years, with share price growth of 447% between 2020 and 2025.

Merchant West Investments portfolio manager and director Piet Viljoen has highlighted Argent as a strong investment opportunity.

At the 2024 BizNews Conference, Viljoen said Argent matched the three main characteristics he looks for when picking companies – it is small, generates good earnings with solid fundamentals, and its management team is good at capital allocation.

“If you put these three things together, you can build a wonderful portfolio of value stocks which can outperform the market,” Viljoen said.

“If you can buy a good company at a starting price-to-earnings (P/E) ratio of 5, your earnings yield is 20%. If such a company only maintains what it has been doing without any growth, you will earn 20%.”

According to Viljoen, Argent meets this criterion, which is why he also highlighted the company at a JSE stock picking event in November 2024.

At this event, he said Argent’s operations go beyond what most people perceive, as it has spent the past decade strategically restructuring its portfolio.

The company sold off lower-return businesses and reinvested that capital into higher-return sectors, which saw Argent’s return on equity improve significantly.

Viljoen said this transformation began six years ago when a very astute investor acquired a significant stake and took a leading role in refining the company’s capital allocation strategies. 

Argent now operates as a well-managed, high-return business that consistently generates value, largely independent of economic cycles.

According to Viljoen, this self-sustained business model, guided by strong management and effective capital allocation, is a “bargain”.