The shares of Honda India Power Products Ltd climbed a whopping 20% on Wednesday’s early trades to reach an intraday high of ₹ 2205.35 apiece on the National Stock Exchange (NSE). Its shares were trading at ₹ 2115.00 a piece, up 15.08%, at 01:03 PM on Wednesday.
Honda India Power Products, formerly Honda India Power Products, manufactures and markets portable gensets, water pumps, general-purpose engines, lawnmowers, brush cutters and tillers.
The company’s shares soared after it reported an enormous increase in its net profit for the latest quarter. According to the unaudited financial results published by the company for the quarter and half year ended September 30, 2022, its net profit came in at ₹ 42.42 crores in
the September quarter (Q2FY23). Its profit has increased by a massive 764% since it reported a profit of ₹ 4.91 crores in the corresponding quarter last year (Q2FY22).
It posted a topline of ₹ 399.63 crore in September 2022 (Q2FY23), indicating an increase of 94.17% when compared with ₹ 205.81 crore in September 2021 (Q2FY22).
Honda India Power Products is a small cap company with a market capitalization of ₹ 1,864 crore. The company is almost debt free with a debt to equity ratio of ₹0.00 and has an ideal return on equity of 11.69%.
Its shares are trading at a price to equity ratio (P/E) of 31.26, which is slightly lower than the industry P/E ratio of 34.04, therefore the stock might be undervalued. Further, its promoters hold a 66.67% stake in the company. Tata Small cap Fund Direct Growth and Nippon India Small Cap Fund Direct Growth are two mutual funds that hold a stake in this company.
Written by Simran Bafna
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