The S&P BSE Smallcap stock’s volumes were rising steadily through the week and today hit 10% upper circuit on Thursday within the first hour since markets opened, at just ~70% of yesterday’s volume.
The stock rose 10.0% and made a new 52W High at which it now stands – Rs. 3040.10. Its market capitalization is currently Rs. ~4005 crores and processes a P/E – 29.98 much lower than the sector average – 52.99. It closed ~23.4% above the 50-day moving average and ~82.9% above the 200-day moving average.
Force Motors Ltd’s (“Force”) price action was most likely due to industry-leading and consensus-exceeding results for Q1 FY24. The company reported 53.0% YoY revenue growth from Rs. ~978 crores to Rs. ~1,500 crores and a 413% net profit growth from a Net loss of Rs. ~16.59 crore to Rs. ~68.59 crore profit. Force has delivered 17.7% revenue and 38.6% net profit 3Y CAGR and boasts a strong financial with a Piotroski score of 8.
Force’s growth was volume and macro-driven. Volumes grew ~12.9% QoQ from ~2150 to ~2430 units. Macro-wise, the company stated it expects sustained growth moving forward through a favorable macro for the industry driven by private and government spending. The company has a beta (60M) of 0.68 indicating below-average volatility and 0.0% short interest.
Force is a multibagger – stock returned 175% in 1 year period, 224% return over 3 year period, and 119% YTD. If you invested Rs. 1 lakh in Force at the start of the year, the position would now be worth Rs. 2.19 lakh! The company also has a stable shareholding, in the last 6 quarters – promoters hold 61.6% (no pledges), 5.6% hold FIIs & DIIs, and the rest are public float.
Force is an integrated automobile company, designs, develops, manufactures, and sells a range of automotive components, aggregates, and vehicles in India and exports its products abroad – MEA & LATAM. The company has the highest relative market share in the LCVs & HCVs segment and was founded in 1958, based in Pune, India.
Written by Sandeep R
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