Bharat Seats is a JV between India’s Relan group, Maruti Suzuki and Suzuki Motors for manufacturing of car seats for Maruti Suzuki. It also makes moulded floor carpets and Two Wheeler Seats for Maruti and Suzuki. The total promoter stake is at 74.31% of which MSIL and SMC hold 14.81% each. Another group company of Bharat Seats, Sharda Motors holds 28.66%. The promoters, Relan family has marginally hiked their stake in the company in current Q1 from 74.21% in Q4.

For Q2FY15, the company posted a very good set of numbers. On a 33% (YoY) rise in net sales at Rs.173  crore, it posted a net profit of Rs.2.21 crore, up 35% and sequentially, it was up 67%. And for H1FY15, the company’s net profit was at Rs.3.54 crore, up 22%.

This company makes products mainly for Maruti and Suzuki thus its fortunes are tied deeply with them. It remains a small cap company with an equity of Rs.6.28 crore and market cap of just Rs.95 crore. It is sitting on a reserve of Rs.35 crore. Its margins are wafer thin and that is the biggest dissuading factor in this stock – NPM for almost all the four quarters of FY14 has been just over 1% but less than 1.5%.