A company of a ‘fundamentally strong’ nature portrays certain characteristics, viz, strong and consistent financial performance, lower leverage ratios, and many more.
Listed below is one such fundamentally strong stock in which a couple of well-known ace investors based in India, viz, Mr. Vijay Kedia and Ms. Dolly Khanna, reduced their respective holdings during the December 2023 quarter:
Talbros Automotive Components Limited
With a market capitalization of Rs 1,777.77 crores, the stocks of Talbros Automotive Components Limited are currently trading at Rs 288, slipping approximately 0.60 percent as compared to the previous closing levels of Rs 289.70 apiece.
A couple of well-known ace investors, viz, Mr. Vijay Kedia and Ms. Dolly Khanna, reduced their respective holdings during the December 2023 quarter.
The former reduced its holding from a 1.22 percent stake during the September 2023 quarter to a 1.01 percent stake during the December 2023 quarter, and the latter, during the same horizon, reduced its holding from 1.57 percent to 1.34 percent.
Having a glance at the financials of the company, the prime indicators of business, i.e., operating revenues as well as net profits, were on the rise during the recent financial quarters.
The former rose from Rs 182.83 crores during Q1FY23-24 to Rs 194.03 crores during Q2FY23-24, and the latter, keeping the timeframe the same, shifted from Rs 13.97 crores to Rs 16.04 crores.
In addition, the basic profitability ratios such as the return on equity (RoE) as well as the return on capital employed (RoCE) reported an increase with the former recently moving from 16.34 percent during FY21-22 to 16.6 percent during FY22-23 and the latter rising from 18.38 percent to 19.32 percent.
The net profit margin (NPM) of the company, too, rose from 7.78 percent during FY21-22 to 8.59 percent during FY22-23. During the same period, the company’s debt-to-equity ratio stayed within the desired limits shifting down from 0.29 times to 0.24 times.
Keeping a purview of one year, the company’s stock has delivered multibagger returns of nearly 165 percent to its stakeholders, i.e., if someone had invested Rs 1 lakh into the company’s stock a year ago, it would have converted to Rs 2.65 lakhs.
As per the recent presentations, the company announced multi-year orders worth over Rs 1,000 crores comprising heat shields, gaskets, forgings, and chassis. The same will help the
company to increase its customer base across geographies thereby gaining a decent market share in the upcoming years.
Founded in 1956, Talbros Automotive Components Limited is a company based in India that is engaged in the business of manufacturing auto components. The company designs, develops, and manufactures various products, some of which include gaskets, heat shields, forgings, suspension systems, and others.
Written by Amit Madnani
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