TVS Srichakra

A part of the TV group, TVS Srichakra , with manufacturing units at Madurai (Tamil Nadu) and Rudrapur (Uttrakhand), makes2 and 3-wheeler tyres. Naturally, given its pedigree, it enjoys immense investor fancy on the bourses. This stock is like MRF – tyre company, south based, small equity, great reputation, huge reserves and sound fundamentals.

The company ended Q1FY16 with a 3 times jump in net profit at Rs.49 crore on a 12% (YoY) jump in net sales at Rs.499 crore. Tight leash was kept on costs, which rose by only 3%. EBITDA was at Rs.83 crore, up 107% and margins rose from 8.87% to 16.50%. Interest cost was down 48% and this was offset by a 3.5 times rise in tax outgo.

The company’s equity stands at Rs.7.66 crore with reserves of Rs.269 crore. EPS for the quarter is at Rs.63.95 (Rs.10 face value). But unlike MRF, TVS Srichakra’s FII and DII holding is miniscule, less than even 1%.