Swaraj Engines hits a new high

Swaraj Engines supplies engines to the Swaraj division of Mahindra & Mahindra. The stock hit a new 52-week high today at Rs.1450, up almost 7% from yesterday close. Volumes have jumped up over 8 times.

The market is thrilled with the company’s Q3FY17 performance. Its net profit rose by a smart 82% (YoY) at Rs.15 crore on a 47% rise in total income at Rs.155 crore.

EBITDA was up 80% at Rs.23 crore and margins showed a very good improvement from 12.1% to 14.9%. This fantastic growth was thanks to the 49% jump during the quarter in engine sales  and it achieved the highest ever quarterly sale of engines in Q3 at 19,150 units.

The company is planning to increase its capacity to meet the growing demand from current 1,05,000 pa units to 1,20,000 pa units. This is to be funded entirely via internal accruals. The company continues to remain largely debt free.