Shares of auto ancillary firm JBM Auto have given exceptional returns to its investors in the long term. Moreover, they have outperformed benchmark indices in the near term.
In the past six months, the company’s share price rallied 123% to deliver multibagger returns and has turned an investment of ₹ 1 lakh into ₹ 2.23 lakhs!
However, the company’s share price surged by a whopping 17644% from ₹ 5.20 apiece to ₹ 922.70 apiece. Therefore if an investor had invested ₹ 1 lakh in the company’s shares ten years ago, the value of their holdings would have been more than ₹ 1.77 crores today!
JBM Auto is engaged in the automotive business. It manufactures and sells sheet metal components, tools, dies, moulds and buses. Moreover, it is an original equipment manufacturer of passenger buses. Some of its major clients include Ashok Leyland, Bajaj, Daimler, Fiat Chrysler, Ford, Honda, Hero, JCB, Mahindra, Maruti Suzuki, Renault, Nissan, TATA, Toyota, TVS, Volvo Eicher and Volkswagen.
The auto ancillary firm is a small-cap stock with a market capitalization of ₹ 11,127 crores. It has a return on equity of 12.92% and a debt-to-equity ratio of 1.65% (which is usually higher than ideal in this industry). The company’s shares were trading at a price-to-earnings ratio (P/E) of 89.11, which is higher than the industry P/E of 39.33, indicating that the stock might be overvalued as compared to its peers.
The company’s shares hit their all-time high of ₹ 1689.95 apiece on January 24, 2022, and their all-time low of ₹ 16.1 on 27 October 2008.
Written By Simran Bafna
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