The shares of Automotive Axles Ltd have shown an upside movement of around 9 percent today. The company’s stock opened its trading session at Rs 2,315 and is currently trading at Rs 2,527 showing an upside of around 9 percent.
Automotive Axles, established in 1981, is engaged in the business of manufacturing and supplying Automotive Parts to the major domestic and global manufacturers of Trucks & Buses (LCV, MCV, HCV, and Military & Off-highway Vehicle Segment).
Having a purview of 6 months, the share price movement shows an upside of around 21 percent from Rs 2,090 to the current stock levels. Further, in the span of a year, the shares have logged a 74 percent return.
The company manufactures a wide range of products which includes Drive Axles, Front Steer Axles, Off-highway Axles, etc. It also provides aftermarket solutions to its customers.
Digging into the financials of the company, the revenues of the company have gone up from Rs 474.7 crores in Q2 v/s Rs 655.7 crores in Q3. Apart from the same, the net profit of the company has improved as well showing congruence with the revenues which is from Rs 30.1 crores in Q2 v/s Rs 50.6 crores in Q3.
Taking the evaluation further with the ratios of the company, the first one being the profitability ratios, the company has been able to deliver good returns to its stakeholders with an ROE of 4.19 percent in FY20-21 v/s 12.66 percent in FY 21-22.
Moreover, the returns on the capital employed have also shown growth from 5.88 percent in FY20-21 v/s 16.97 percent in FY 21-22. The PE ratio of the company which is 23.34 is way below the industry PE of 38.18.
Another important aspect to note is that the debt-to-equity ratio of the company has been consistently going down for the past 4 financial years and the latest movement being from 0.03 in FY20-21 to 0.02 in FY 21-22.
Written by Amit Madnani
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