Union Road Transport and Highways Minister Nitin Gadkari announced that he has approved the draft notification to mandate the installation of air-conditioning systems in the cabins of N2 and N3 category trucks. The government plans to implement this regulation starting from January 2025.
Following the announcement, the shares of Subros, an automotive air-conditioning manufacturer surged 11.65 percent to reach an intraday high of ₹ 487.00 apiece on the National Stock Exchange (NSE). At 11:43 AM, its shares were trading at ₹ 468.10 apiece, up 7.31 percent.
Subros is engaged in the manufacturing and supplying of Thermal products and air conditioning products for automakers and homes. It has plants located in Noida, Pune, Chennai, Karsanpura and Nalagarh.
With a market capitalization of ₹ 2,846 crores, Subros is a small-cap company. It has a low return on equity of 5.67 percent but an ideal debt-to-equity ratio of 0.02. Its shares were trading at a price-to-earnings ratio (P/E) of 59.35, which is higher than the industry P/E of 46.57, indicating that the stock might be overvalued as compared to its peers.
The company’s promoters hold a 36.79 percent stake in it followed by foreign institutions with 32.62 percent, retail investors with 17.29 percent, and mutual funds with 13.30 percent.
Subros posted revenue of ₹ 2,806 crores in FY23, up 25 percent against ₹ 2,239 crores reported in FY22, The company’s net profit grew by 47 percent to ₹ 47.92 crores as compared to ₹ 32.49 crores in the corresponding quarter of the previous year.
Written by Simran Bafna
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
