EV bus companies were in focus on Wednesday, as the Cabinet chaired by Prime Minister Narendra Modi approved the PM-e Bus Seva Scheme, Anurag Thakur, Minister of Information and Broadcasting said at a briefing.
A total outlay of ₹ 57,613 crore has been allotted to the e-Bus scheme. Of this, the Central Government will provide ₹ 20,000 crores, while the remaining will be paid for by State Governments. 10,000 e-buses will be deployed in 169 cities. This scheme is expected to generate 45,000 to 55,000 direct jobs and will support bus operations for 10 years.
The PM-e Bus Seva Scheme will cover cities with a population of 3 lakh or more, all capital cities of union territories, hill states and the north-east region. Moreover, the Centre will also create behind-the-meter power infrastructure for e-buses.
Soon after this announcement was made, the shares of automobile companies that manufacture electric buses spiked.
Olectra Greentech
Olectra Greentech gained 10.00 percent to reach an intraday high of ₹ 1,236.10 apiece on the National Stock Exchange (NSE). In the past six months, the company’s share price increased by 190 percent, delivering multibagger returns. If an investor had invested ₹ 1 lakh in its shares six months ago, the value of their holdings would have been ₹ 2.90 lakhs today!
With a market capitalization of ₹ 9,216 crores, Olectra Greentech is a small-cap company. It has a low return on equity of 12.42 percent and an ideal debt-to-equity ratio of 0.00. Its shares were trading at a price-to-earnings ratio (P/E) of 137.43, which is significantly higher than the industry average of 23.65, indicating that the stock might be overvalued as compared to its peers.
Olectra Greentech primarily operates in two major business segments — e-bus and insulators. The company operates more than 1,000 electric buses commercially in India.
JBM Auto
JBM Auto gained 12.42 percent to reach an intraday high of ₹ 1,474.00 apiece on the National Stock Exchange (NSE). In the past six months, the company’s share price increased by 160 percent, and by 248 percent in the past year, to deliver multibagger returns. If an investor had invested ₹ 1 lakh in its shares six months ago, the value of their holdings would have been ₹ 2.60 lakhs today! If the same amount was invested a year ago, the value of their holdings would have been ₹ 3.48 lakhs today!
With a market capitalization of ₹ 15,498 crores, JBM Auto is a small-cap company. It has a low return on equity of 10.48 percent and an ideal debt-to-equity ratio of 0.02. Its shares
were trading at a price-to-earnings ratio (P/E) of 120.35, which is significantly higher than the industry average of 36.88, indicating that the stock might be overvalued as compared to its peers.
JBM Auto manufactures and sells sheet metal components, assemblies, sub-assemblies, tools, dies and moulds. It offers end-to-end solutions for all business segments including two-wheelers, three-wheelers, passenger vehicles and commercial vehicles.
Written by Simran Bafna
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