Auto ancillary stock jumps 19% after company’s net profit increased by 64% YoY

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Auto ancillary stock jumps 19% after company’s net profit increased by 64% YoY
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The shares of the leading automotive wheel manufacturers gained 19% to ₹700 per share on Tuesday after the company registered a net profit growth of 64% year over year.

At 11:20 a.m., Wheels India Ltd shares were trading at ₹685 per share, up 16.39% on the Bombay Stock Exchange from the previous close price. The company has a market capitalization of ₹1,673 crore.

Wheels India reported a 64.3% increase in its net profit for Q4 ended March 31, 2024, reaching ₹. 36.8 crores, up from ₹. 22.4 crores in the same quarter of the previous year.

For Q4 ended March 31, 2024, the company’s revenues were ₹ 1,167 crores, slightly down from ₹. 1,172 crores in Q4 ended March 31, 2023.

For the full year ended March 31, 2024, net profit rose by 20% to ₹. 61.16 crores, compared to ₹.50.94 crores for the year ended March 31, 2023. Revenues for the full year increased by 7.2% to ₹. 4,977 crores, up from ₹. 4,640 crores in the previous year.

The company’s management stated, “Exports performed well in FY24, showing a 24.5% growth. The primary drivers of export growth were earthmover wheels, aluminum wheels, and hydraulic cylinders. Additionally, the air suspension business and bus market also saw significant growth.”

The Board of Directors has recommended a dividend of ₹. 7.39 (73.90%) per equity share of ₹. 10 each for the financial year 2023-24, totaling ₹. 18.06 crores.

Wheels India is a leading manufacturer of wheels for trucks, agricultural tractors, passenger vehicles and construction equipment; air suspension systems for trucks and buses, and industrial components for the construction and windmill industry with manufacturing plants in Tamil Nadu (NS: TNNP ), Maharashtra, Uttar Pradesh and Uttarakhand.

Wheels India shares have increased by 3% over the past six months and by 18% over the past year.

The company exports its products internationally to customers including Caterpillar (NYSE: CAT ), Komatsu, Volvo, JCB, TCM, Shin Caterpillar Mitsubishi, Kawasaki Heavy Industries, Hyundai Heavy Industries, Mitsubishi Heavy Industries, Doosan Infracore, Case New Holland, Bell Equipment, and Kato.

Similarly, its domestic customers include Hindustan Motors (NS: HMTR ), Ingersoll Rand, L&T, Escorts (NS: ESCO ), TIL, PL Haulwel Trailers and L&T CASE Equipment.

Written by Omkar Chitnis


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