GoodYear
Goodyear India, a 74% subsidiary of US-headquartered, is one of world's largest tyre companies. This debt free MNC enjoys leadership position in the domestic farm tyres market, which are manufactured at its Ballabgarh (HP) plant. Medium commercial truck tyres are also manufactured at the same facility. The company also trades in Goodyear branded tyres for passenger and off-the-road (OTR) vehicles, mainly catering to replacement demand, manufactured at Aurangabad by a group company. This accounts for nearly one-fourth of company's sales turnover.
The company has done well for the 9-month ended 30th Sept 2013, posting a net profit of Rs.66.50 crore, which is already much higher than the net profit of Rs.56 crore posted for CY12. Given the rich monsoon and bountiful harvest, tractor sales are expected to jump in and this in turn would mean much better earnings for the company in Q4 as Goodyear is a leader in the farm tyre segment. Robust earnings apart, there are two major triggers for the stock. First is the persistent expectation of delisting. The company had unsuccessfully undertaken a delisting move in April 2010 at Rs. 340 per share, which did not sail through due to poor participation from public shareholders. The delisting move, may once again, be initiated by the overseas parent in the next 12 months, at a much higher price, which will be a big trigger for the stock price. Second major trigger is the sale of land. The company owns tracts of land at Faridabad , outskirts of New Delhi. And if the company decides to sell this, it could earn the Goodyear a major fortune.