Jay Bharat Maruti

The fortune of this JBM group company, Jay Bharat Maruti is indelibly linked with that of Maruti Suzuki. The company had a disappointing Q1FY17. It began right from the topline – net sales dropped 8.5% (YoY) to Rs.333 crore. After that, despite a 8% drop in total costs, led by a 9.5% decrease in raw material costs, rise in other income and lower tax and interest outgo, the company could not end the quarter with higher bottomline. Its net profit came in at Rs.7 crore, down 12%. EBITDA was also down 8% at Rs.24 crore and margins were a tad better due to lower costs at 7.21% v/s 7.14%.

This auto part and equipment making company is a JV between the JBM Group and Maruti Suzuki, which holds 29.28% stake. JBM Industries holds 2.84%. Total promoter holding is at 58.56%. Around 90% of its business comes from Maruti while the rest is sold to Eicher Motors and M&M. A small cap and low volume company, returns are capped and fortunes are interminably linked with that of Maruti. Hopefully, with Maruti expected to do much better in coming months, remaining months could be much better. The Rs.5 FV stock, on an equity of Rs.10.82 crore, posted an EPS of Rs.3.25.