The shares of the electric vehicle manufacturer gained up to 6 percent after the company’s revenue and net profit magnified significantly by 152 percent and 70 percent in Q2FY25, respectively.
With a market capitalization of Rs 13,665.62 crore, the shares of Olectra Greentech Ltd were trading at Rs 1,657.30 per share, increasing around 2.24 percent as compared to the previous closing price of Rs 1,621.00 apiece.
Reason for rise:-
The shares of the company have seen positive movement after Olectra Greentech Ltd announced results in which revenue magnified by 77 percent on year on year basis from Rs 307 crore in Q2FY24 to Rs 524 crore in Q2FY25, however in Quarter on a Quarter basis revenue zoomed by 67 percent from Rs 314 crore in Q1FY25 to Rs 524 crore Q2Y25.
Moreover, net profit magnified multifold times by 153 percent on a yearly basis from Rs 19 crore in Q2FY24 to Rs 48 crore in Q2FY25, meanwhile on a quarter-on-quarter basis net profit jumped by 100 percent from Rs 24 crore in Q1FY25 to Rs 48 crore in Q2FY25.
Production Capacity & New Plant:-
The company transitioned to a new state-of-the-art plant at Seetharampur, with partial operations starting in Q1 FY ’25. Current production is 200 buses per month, targeting 400 by year-end. Capacity aims to reach 5,000 buses annually by FY ’25 and over 10,000 later.
Order Execution & Guidance:-
The company aims to deliver 1,500 to 2,000 buses in FY ’25, expecting to double Q2 deliveries compared to Q1. While acknowledging past production challenges, management is confident in meeting this year’s targets and overcoming previous obstacles to achieve its goals.
Market Dynamics:-
Management highlighted the growing demand for electric buses, driven by government initiatives to electrify public transport. While concerned about competition from faster OEMs, Olectra is focused on ramping up capacity to meet demand. They are actively participating in new tenders and maintaining strong stakeholder relationships for smooth execution.
Challenges:-
The company initially faced challenges with the new plant and battery compliance norms, but these issues have been resolved. Despite concerns about penalties for delayed deliveries affecting future orders, management remains optimistic due to strong product performance and solid relationships with State Transport Undertakings (STUs).
Margins & Financial Guidance:-
Management expects operating margins to remain healthy, targeting 10% to 12% in the long term. Despite potential fluctuations in product mix, they are cautiously optimistic about sustaining these margins, balancing operational efficiency with market dynamics to ensure financial stability.
Company Overview:-
Olectra Greentech Limited is an India-based firm that manufactures composite polymer insulators and electrical buses. The company is divided into three segments: insulator, e-bus, and e-truck. Its major products are power insulators and electric buses.
Written by:- Abhishek Singh
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