Shivam Auto in top gear
Shares of Hero Group’s Shivam Auto are currently trading higher by 6.5%, up Rs. 4.60 at Rs. 79 per share. They have retreated from day’s high of Rs. 82.80. Company announced December quarter results over the weekend and market is reacted to the consistent performance.
While Q3 revenue contracted by 1.6% from Rs. 109.3 crore in Q2 to Rs. 107.6 crore in Q3, EBITDA showed marginal improvement to Rs. 21.4 crore (up 0.6% QoQ), as EBITDA margin expanded by 45 basis points aided by lower input costs. With net profit of Rs. 6 crore, EPS for third quarter ended 31st December 2014 stood at Rs. 1.20 per equity share of face value Rs. 2 each. EPS for nine months stood at Rs. 4.39.
At current market price, share is ruling in early teens i.e. at a PE multiple of close to 14 times, which is attractive given the group pedigree coupled with revival in the auto component sector.