With a market capitalization of ₹ 5,839 crores, Jupiter Wagon is a small-cap company that manufactures railway wagons, passenger coaches, wagon components and castings in India. The company also manufactures couplers, draft gears and railway turnouts for the Indian Railways and North American railroads.
Jupiter Wagon’s share price rallied 226% in the past year and delivered multibagger returns as its share price increased from ₹ 46.30 to ₹ 150.80 apiece. Therefore an investment of ₹ 1 lakh made in the company’s shares a year ago would be worth ₹ 3.26 lakh today!
According to a research report by Sharekhan, Jupiter Wagons is increasing its manufacturing capacity from 600 wagons per month in Q4FY23 to 700 wagons per month by Q4FY24 to meet the growing demand from the Indian railways. It added that the company has a robust order book of ₹ 5818 crores, giving it revenue visibility for the next 18 months.
Jupiter Wagon is expanding the scope of its railway orders. It commenced disc brake production and received an initial order of ₹ 80 crores to supply brakes for passenger coaches. It expects substantial orders from Indian Railways and aspires to generate revenues of ₹ 100 crores in FY24 and ₹ 250 crores in FY25 from braking systems.
The company has clients like commercial vehicle OEMs (original equipment manufacturers), and Indian defence and logistics companies. It is eyeing the fast-growing electric vehicle market. In fact, it has launched two electric light commercial vehicles and aims at capturing a 7-10% market share.
Jupiter Wagons has an ideal return on equity of 16.26% and an ideal debt-to-equity ratio of 0.36. Its shares were trading at a price-to-earnings ratio of 46.84 which is higher than the industry average of 26.93, indicating that the stock might be overvalued as compared to its peers.
Written By Simran Bafna
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