The shares of this smallcap company surged around 7 percent in Monday’s trading session after announcing a record rate for a 1:1 bonus share. In just one month the stock has delivered more than 60 percent return to its shareholders.
Price Movement:
With a market capitalization of Rs. 2,137 crores, the shares of NDR Auto Components Ltd started Monday’s trading session on a higher note at Rs. 1,749 compared to its previous close of Rs. 1,687.60.
During the trading session, the shares hit a high of Rs. 1,850, gaining around 7 percent, also recorded as the company’s fresh 52-week high and are currently trading at Rs. 1,794 apiece.
What Happened:
Such a bullish movement in the share price was observed after the company in an exchange filing announced that it has set September 25, 2024, as the record date for a 1:1 bonus issue. Shareholders will receive one bonus share for every share held.
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Financials:
Looking at the company’s financial statements, the revenue decreased by around 3 percent from Rs. 176.05 crores during the March quarter to Rs. 171.31 crores in the June quarter. On the other hand, the net profits decreased marginally by 0.68 percent from Rs. 11.61 crores to Rs. 11.53 crores during the same timeframe.
Future Outlook:
The company is focusing on volume growth through new model launches and ongoing partnerships. It aims to boost its market share with Maruti, which is currently in the mid-30s, with the goal of surpassing 40 percent within the next 2-3 years.
Furthermore, the company is actively pursuing land acquisition opportunities near Kia’s manufacturing facility to enhance its operational capacity.
This move is aimed at better serving its large OEM clients, including a recent appointment as a T2 supplier to Hyundai, with supply expected to commence in January 2025. Additionally, NDR Auto plans to start manufacturing sunshades for Maruti Suzuki and Toyota by early 2025.
Moreover, NDR Auto is positioning itself to capitalize on the growing demand for EVs, supported by government incentives and a burgeoning EV ecosystem in India.
Important Financial Ratios:
In terms of key financial metrics, the company reported a Return on Equity (RoE) of 15.26 percent and a return on capital employed (RoCE) of 16.02 percent for the period spanning FY23-24. Additionally, during the same timeframe, the net profit margin stood at 5.22 percent.
Customer Base:
NDR Auto Components Limited primarily serves major automotive manufacturers, with its largest customers being Maruti Suzuki India Limited and Toyota Kirloskar Motor Private Limited, for whom it supplies seat frames and trims for various passenger vehicles.
The company also has ties with Bharat Seats Limited and Toyo Seat India Private Limited, which are associated entities.
Also Read: Auto ancillary stock jumps after forming JV with Japanese firm Hamakyorex and acquisition
Company Profile:
Established in March 2019, NDR Auto Components specializes in the manufacturing of seating systems and components for the automotive industry, specifically focusing on seat frames and trims for both four-wheeler and two-wheeler vehicles.
Written By Vaibhav Patil
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