Shares of a company engaged in providing comprehensive mobility solutions encompassing rail, road, and marine transportation surged nearly 2.3 percent on BSE to Rs. 481.5 in the trading session of Tuesday.
With a market cap of Rs. 19,690.3 crores, the shares of Jupiter Wagons Limited opened in the green at Rs. 474.65, up by nearly 0.88 percent, as compared to its previous closing price of Rs. 470.5.
Management Outlook based on Trade Brains’ Analysts Q&A
During the recent company conference call, analysts from Trade Brains asked a few insightful questions to the management. Here are the details:
(i) The company expects strong growth in non-wagon businesses like safety systems, eLCVs, and high-speed brake systems. How are you planning to scale and integrate these segments, and what revenue growth can be seen from them?
The company expects revenue growth of 50-57 percent from its non-wagon business over the next 3-4 years, with production anticipated to reach around 10,000 wagons by the close of FY25, including nearly 4,100 wagons in the first half of FY25.
Management also highlighted plans to launch commercial vehicles by the end of Q3 FY25, targeting sales of 1,000 units by year-end.
Through its wheel business, the company generated Rs. 160 crores in revenue during H1 FY25 and expects to reach Rs. 300 crores for FY25, with projections of Rs. 700 crores in FY26.
(ii) Could you give us a sense of the kind of growth in terms of revenue from core and non-core segments and margin you are looking at in H2FY25 and FY26? And what is the expected order and capex the company plans to make in the period?
According to the management, the Railways segment continues to experience strong demand. They also mentioned that Jupiter Wagons plans to enter the passenger coach segment by FY26, becoming the only company to do so. In the wheel segment, the company expects to sell 25,000 wheelsets by FY25.
The company has allotted a capex of Rs. 3,500 crores for the wheel capacity, including funds for replacement purposes.
Further, the company projects its order book will grow by Rs. 10,000 crores by FY25 and reach Rs. 12,000 crores by FY26. The wheel set production capacity is expected to increase to 25,000 through strategic acquisitions.
The company’s subsidiary Jupiter Electric Mobility acquired Log9’s railway and electric truck battery divisions, enhancing its position in electric truck and railway battery solutions.
Jupiter Wagons Limited has strategically rebranded its subsidiary Bonatrans India Private Limited to Jupiter Tatravagonka Rail Wheel Factory Private Limited.
The production capacity will be expanded from the current 20,000 forged wheels and axles per year to 1 lakh forged wheelsets by setting up a new facility in Odisha with an investment of about Rs. 2,500 crores.
Financials:
For Q2 FY25, Jupiter Wagons Limited reported revenue from operations of Rs. 1,009 crores, reflecting a growth of around 14.7 percent QoQ from Rs. 880 crores in Q1 FY25, and about 14.8 percent YoY increase from Rs. 879 crores in Q2 FY24.
The company’s net profit for Q2 FY25 stood at Rs. 89 crores, representing a marginal decline of around 3.3 percent QoQ from Rs. 92 crores in Q1 FY25, but a year-on-year growth of nearly 8.5 percent from Rs. 82 crores in Q2 FY24.
EBITDA (excluding other income) for Q2 FY25 stood at Rs. 139.5 crores, reflecting a 15.6 percent YoY increase from Rs. 120.7 crores in Q2 FY24, while the EBITDA margins improved marginally, rising from 13.7 percent in Q2 FY24 to 13.8 percent in Q2 FY25.
Key Developments in Q2 FY25:
During H1 FY25, Jupiter Wagons completed a Qualified Institutional Placement (QIP) for equity shares raising Rs. 800 crores and has also raised Rs. 33.7 crores through preferential allotment of share warrants.
The capital raised will be primarily used to establish a full wheel and axle manufacturing plant, enhancing our pipeline integration and supporting long-term growth.
As of Q2 FY25, the company’s order book stood at Rs. 6,643.6 crores. Stock Performance:
The stock has delivered positive returns of nearly 45.8 percent in one year, while around 4.2 percent of negative returns in the last six months. So far in 2024, the shares of Jupiter Wagons have given positive returns of about 45 percent.
About the Company:
Jupiter Wagons Limited, formerly known as Commercial Engineers and Body Builders Co Limited, is engaged in the business of manufacturing railway wagons, wagon components, castings, metal fabrication comprising load bodies for commercial vehicles, rail freight wagons and components with manufacturing facilities at Hooghly (WB), Jabalpur (MP), Indore (MP) and Jamshedpur (Jharkhand).
Written by Shivani Singh
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