Tag Electric Vehicles

Sona BLW Precision Forgings Ltd
Is Sona BLW Precision Forgings Buy? Analyzing Fundamentals Amid Stock Weakness

Business and Industry Overview: 

Sona BLW Precision Forgings Ltd, also called Sona Comstar, is an Indian company that makes vehicle parts. It has nine factories in India, China, Mexico, and the USA. The company makes gears, motors, and other important parts used in cars, trucks, and electric vehicles (EVs). Sona Comstar sells these parts to big car companies in the US, Europe, India, and China. It makes differential gears, starter motors, and special motors for EVs. These parts help vehicles run smoothly and work better. The company makes parts for both fuel-based and electric vehicles. 

More people are buying electric vehicles. This is helping Sona Comstar grow. The company makes special motors like BLDC and PMSM motors for EVs. It also makes motor control units, which help control power and speed in electric cars. These parts make electric cars last longer and perform better. Sona Comstar uses modern machines and new technology. It works to improve designs and make better products. It makes parts for cars, trucks, off-road vehicles, and electric two- and three-wheelers. 

As the world moves towards electric and advanced vehicles, Sona Comstar will keep growing. The company is working on better, smarter, and more efficient parts for the future of cars. The automotive components industry makes important parts for vehicles like engines, brakes, and electrical systems. In India, demand is growing because more people are working and earning money. The country is also becoming a global hub for making and exporting these parts. Companies around the world are choosing India instead of China for manufacturing. India exports 25% of its auto parts, and this is expected to reach $100 billion by 2030. The government is helping the industry by allowing 100% foreign investment and giving funds for electric vehicle projects. India also has a cost advantage, as making auto parts here is 10-25% cheaper than in Europe and Latin America. The country is also the second-largest steel producer, which helps keep costs low. With strong demand, growing exports, and government support, India’s auto components industry is set to grow fast.Sona BLW is known for quality and innovation. It invests in new technology to improve its products. The company makes many different parts, which allows it to serve all types of vehicles like cars, trucks, and two-wheelers. Since India has low-cost manufacturing, Sona BLW can make parts cheaper than companies in Europe and North America while keeping high quality. The Indian government also supports the auto parts industry by allowing 100% foreign investment and offering incentives for EV production. Even though the company’s stock has dropped recently, its profits and future growth look strong. Experts believe it will continue to grow as demand for car parts increases worldwide. 

Latest Stock News: 

Sona BLW Precision Forgings stock price fell 23% in the last three months, but the company is still financially strong. A key measure of its performance is Return on Equity (ROE), which is 11%. This means the company earns ₹0.11 profit for every ₹1 invested. The industry average ROE is 12%, so Sona Comstar is close to that level. The company’s profits grew by 17% in the last five years, but this is lower than the industry growth of 28%. It reinvests 65% of its profits and also pays dividends to shareholders. Experts believe ROE will increase to 15% in the next three years, which means profits may grow faster. Sona BLW has closed its trading window from March 17, 2025, until 48 hours after it announces financial results. This is to follow SEBI rules and prevent unfair trading. The company makes high-quality forged parts for cars, trucks, and industrial machines. Right now, Sona BLW’s market value is ₹301.9 billion, and its stock price has dropped 17.59% this year. The average number of shares traded daily is 70,869. Even though the stock is down, experts expect future growth as the company improves its business. 

Potentials: 

Sona BLW wants to grow its business and make more auto parts for electric vehicles (EVs). The company will invest more money in new technology to improve its products. It will focus on making EV motors, motor control units, and differential assemblies because these parts are in high demand. 

The company also wants to sell more products in other countries. It will increase exports to the US, Europe, and China while also growing in India. Since more people are using EVs, Sona BLW plans to work with big car companies to supply them with auto parts. 

Sona BLW is also working on reducing costs and making better products. It will use new machines and automation to make products faster, cheaper, and with better quality. This will help the company stay ahead of its competitors. 

To meet growing demand, Sona BLW plans to build new factories and upgrade old ones. It will also benefit from government policies that support EV production and auto manufacturing in India. 

The company’s goal is to lead the future of the auto industry by focusing on EV technology, selling to more countries, cutting costs, and making high-quality products. 

Analyst Insights: 

  • Market capitalisation: ₹ 30,209 Cr. 
  • Current Price ₹ 486 
  • 52-Week High/Low: ₹ 769 / 464 
  • Stock P/E: 50.6 
  • Dividend Yield: 0.63 % 
  • Return on Capital Employed (ROCE): 24.0 % 
  • Return on Equity: 20.9 % 

Sona BLW Precision Forgings Ltd is a strong company with good growth. In the last three years, its sales grew by 27% per year, and its profit grew by 32% per year. It makes good use of money, with a return of 24% on capital and 20.9% on equity. The company has low debt and earns good profits with a 28% operating margin. 

But there are some concerns. The stock is expensive, with a P/E ratio of 50.6, while competitors like Bosch (38.54 P/E) and Uno Minda (56.93 P/E) are lower or similar. Also, the promoter’s ownership has dropped from 67.18% in 2022 to 28.03% in 2024, which is not a good sign. The stock fell by 24% in the last year and 11% over three years. 

The company has a good future because of its strong position in the electric vehicle (EV) market. But the stock price is high right now. It is better to buy if the price goes below ₹450 or hold if already invested. 

Ola Electric's Ltd
India’s Booming Electric Scooter Market: Growth Trends & Ola Electric’s Stock Performance Amid Regulatory Challenges

Business and Industry Overview: 

The electric scooter market in India is growing very fast. In 2024, it was worth $1,680.24 billion. By 2025, it may grow to $2,238.95 billion. By 2034, it could reach $29,655.80 billion. The growth rate is 33.25% per year from 2025 to 2034. Many people prefer electric scooters because they save money, need less fuel, and do not cause pollution. The government supports this with tax benefits and subsidies. 

Electric scooters use different types of batteries. Lithium-ion (Li-ion) batteries are the most popular. They hold 72.47% of the market. These batteries last longer, charge faster, and must not be replaced often. Other battery types include lead acid and nickel metal hydride (NiMH). Scooters come with different voltages and power. The 60-72V category is growing the fastest. It gives a good balance between power and battery life. More people choose this type because it helps them travel longer distances. Better technology, government support, and better charging stations are helping this growth. 

There are two main types of motors in electric scooters. Hub motors are more popular than belt-drive motors. They need less maintenance, require hub motors, and give better power to the scooter. There are two types of buyers: private users and commercial fleets. Private users hold 70.65% of the market. More people are buying electric scooters for daily travel. This is because of high gasoline prices, government support, and better charging facilities. Many brands now offer different models for personal use. 

Scooters have different travel ranges. The 50-100 km range is the most popular. This range is best for daily travel in cities. It is also affordable and works well with existing charging stations. Scooters are also divided by price. There are budget scooters and premium scooters. Budget scooters sell more because they are cheaper. People prefer them over expensive electric motorcycles. Rising petrol prices, many available models, and government support help the budget scooter market grow. 

Many companies are making electric scooters in India. Some top brands are Hero Electric, Ather Energy, Okinawa Autotech, Bajaj Auto, TVS Motor Company, and Ola Electric. These companies compete in price, battery life, features, and service. Some new companies are also entering the market with new ideas and lower prices. Big developments are happening in the market. In August 2023, TVS launched a new electric scooter called TVS X for Rs. 2.50 lakh. In July 2023, Ather 450X became available with 100% financing, meaning buyers can get it with no down payment. In June 2023, TVS partnered with Zomato to supply 10,000 electric scooters for delivery services. In February 2023, Ola Electric announced it would build the world’s largest electric vehicle hub in Tamil Nadu, with an investment of $920 million. The market will keep growing. Companies are working on better batteries, more charging stations, and new technology like battery swapping and smart scooters. Electric scooters are becoming a popular choice for city travel. 

Latest Stock News: 

Ola Electric is an Indian company that makes electric vehicles (EVs). It started in 2017 and is part of Ola, the ride-hailing company. The company wants to replace petrol vehicles with electric ones to reduce pollution. It makes electric scooters like the Ola S1 Pro, S1 Air, and S1 X. These scooters run on batteries instead of petrol. Ola is also building fast-charging stations across India. The company has a big factory in Tamil Nadu, where only women work. It is also working on better batteries and plans to launch an electric car by 2026. Many big investors, like SoftBank and Hyundai, have funded Ola. The company is worth over $5 billion. It is one of the top EV companies in India. Ola’s goal is to make electric vehicles affordable and easy to use. However, it faces challenges like building more charging stations and improving battery technology. Despite this, Ola is working hard to make clean and green transportation the future of India. 

Ola Electric is in trouble because many of its showrooms do not have the certificate required to keep unregistered vehicles. In India, every showroom must have this certificate and display it. Government officials raided many showrooms, shut some down, took vehicles, and sent notices for breaking the rules. Out of 3,400 showrooms, only about 100 had the right certificate. The problem started in 2023, and fresh warnings came in March 2025. Ola said its experience centers are not selling directly, but the government is still checking. 

Ola has many other problems, too. Customers have complained about product quality and service. The company lost market share to Bajaj Auto and TVS Motor. Its electric motorcycle launch was late, and in March 2025, it removed over a thousand employees. These problems hurt its stock price. Since its stock started trading in August 2024, the price fell by more than 60% from the highest point. On March 10, 2025, Ola’s stock was ₹54.56, which was 3.50% lower than the previous day. 

Recently, Ola’s stock price fell to its lowest in one year because of issues with vehicle registration. The VAHAN portal showed that Ola’s registration numbers were low in February 2025. This happened because Ola is changing agreements with registration agents Rosmerta Digital Services and Shimnit India to reduce costs and make the process better. Ola said its registration numbers may stay low for now, but its sales are still strong. The stock price dropped to ₹58.50 but later recovered by more than 5%, reaching ₹61.59. Ola believes things will get better soon. 

Potentials: 

Ola Electric has big plans for the future. It wants to add 10,000 sales and service partners by the end of 2025. This will help improve customer support. The company is also building a large battery factory in Tamil Nadu. This factory will make its lithium-ion batteries. It will help reduce costs and improve efficiency. But the government sent a notice to Ola for missing a deadline in setting up this factory. 

Ola launched new electric motorcycles in August 2024. The models include “Roadster X” and “Roadster Pro.” These bikes can go up to 200 km on a single charge. Deliveries will start by March 2025. The company is working hard to improve its financial health. In the second quarter of 2024, its revenue grew by 39.1%. Its losses also reduced. 

Ola plans to introduce its batteries to save more money. The company has faced problems like customer complaints. It has also lost market share to Bajaj Auto and TVS. But Ola believes it can recover. It plans to expand its network, improve services, and launch new products. 

Analyst Insights: 

  • Market capitalisation: ₹ 23,572 Cr. 
  • Current Price:₹ 53.4 
  • 52-Week High/Low: ₹ 158 / 53.4 
  • Dividend Yield: 0.00 % 
  • Return on Capital Employed (ROCE): -32.1 % 

Ola Electric’s net loss in FY24 was ₹1,584 crores, and its operating profit margin (OPM) is negative (25%), showing it is not making profits yet. The return on capital employed (ROCE) is -32.1%, meaning it is not using its money efficiently. The stock is trading at 3.64 times its book value, making it expensive. The share price has fallen from ₹158 to ₹53.4, a 66% drop. Sales have grown from ₹1 crore in 2021 to ₹5,010 crores in 2024, but expenses are still higher at ₹6,276 crores. The company has high debt (₹5,684 crores) and a low interest coverage ratio, meaning it struggles to pay interest costs. While it is India’s top electric scooter brand, competition from Hero, TVS, and Bajaj is strong. Given its financial struggles, it is better to hold or sell rather than buy now. 

Tata Motors Ltd.
Tata Motors Stock Strong Falls 44%: JLR Woes, EV Ambitions & Market Outlook- 52 Weeks Low

Business and Industry Overview:  

Tata Motors started in 1945 as part of the Tata Group. It is one of the biggest car companies in the world and has about 81,090 employees. The company makes many types of vehicles, like cars, SUVs, trucks, buses, military vehicles, and electric cars. It has partnered with companies like Fiat and Marcopolo to grow worldwide. Tata Motors is in about 175 countries and has research centers in the UK, Italy, India, and South Korea. In January 2024, it sold 31,188 commercial vehicles. 

Tata Motors has four main business areas. Jaguar Land Rover (JLR) is the biggest, making up 71% of its business in 9M FY25. JLR includes luxury cars and SUVs like Jaguar sedans, electric cars, and Land Rover off-road vehicles. Sales of key models like Range Rover, Defender, and Discovery dropped compared to last year. North America saw more sales (33% vs 26% in FY24), but sales fell slightly in Europe, the UK, and other regions. Tata Commercial Vehicles (17% of the business) is India’s largest truck and bus maker, but its market share fell to 37.7% from 41.7%. Bus sales grew, but truck and small cargo vehicle sales dropped. International sales were also lower. Tata Passenger Vehicles makes up 11% of the business. It is India’s third-largest car company, with a 13.3% market share. It also leads the electric vehicle (EV) market with a 53% share. The company launched new models of the Tiago, Tiago.ev, and Tigor in Q3 FY25. Total car sales, including EVs, increased. Tata Motors also offers vehicle loans, but this part of the business is smaller now, making up only 1% of revenue (down from 3% in FY22). Loan disbursements in FY24 were ₹17,884 Cr. The company has 25 factories across India, China, North America, Europe, and the UK. It spent ₹6,000 Cr on new projects in FY25, including a new factory in Tamil Nadu. R&D spending increased to 6.7% of revenue, focusing on safety tech and smart vehicles. It also filed 670 patents and 424 design applications. In March 2024, Tata Motors decided to split into two separate companies—one for Commercial Vehicles and another for Passenger Vehicles, including JLR and EVs. The split should be finished by October 2025. 

The Indian automobile industry is very important for the country. It helps the economy grow and brings new technology. Most people in India use two-wheelers like bikes and scooters because they are cheaper and easy to use. Many companies are also selling vehicles in villages, which is helping the industry grow. Big trucks and buses are also in demand because more goods and people need to be transported. In the future, electric vehicles (EVs) will be more popular. Small cars and three-wheelers that run on electricity are becoming common. India makes a lot of big vehicles. It is the number one maker of tractors, number two in making buses, and number three in making heavy trucks. In 2023, India made about 26 million vehicles, and in September 2024, the country produced 2.77 million vehicles. The automobile industry adds about 7.1% to India’s total money (GDP) and gives jobs to about 19 million people. India also sells a lot of vehicles to other countries. The government is helping the industry grow with new policies and plans. The Indian car market was worth $32.7 billion in 2021 and is expected to grow to $54.84 billion by 2027. The global EV market was worth $250 billion in 2021 and will grow five times by 2028. 

In the first half of 2025, India produced over 15.6 million vehicles. In 2024 (until January), India sold 1.3 million electric vehicles. By 2030, India’s EV market could be worth $206 billion, but it will need $180 billion in investments. The EV finance market will also grow to $50 billion by 2030. The EV battery market is also expected to grow very fast. India wants to sell five times more vehicles to other countries between 2016 and 2026. 

Big companies are investing a lot of money in India. From 2000 to 2023, India got $35.65 billion from foreign investors. India could become the biggest EV market by 2030. Tata Motors, Renault-Nissan, and Hyundai are building new factories and investing billions of dollars in India. Other companies like Mercedes-Benz, Maruti Suzuki, Hero MotoCorp, and Ola Electric are also spending money to make more vehicles. The government is supporting this with new rules, allowing full foreign investment, and launching programs like PM E-DRIVE and the Electric Mobility Promotion Scheme.

Latest Stock News: 

Tata Motors’ share price has gone down a lot. This is because people are worried that fewer people will buy Jaguar Land Rover (JLR) cars and Tata’s big trucks and buses next year.  In July last year, the share price was ₹1,179, but now it has fallen 43% to ₹662. This happened because JLR cars may not sell well in big countries, and the US might add extra taxes on cars from Europe. Since JLR sells many cars in the US, this could be bad for Tata Motors. Some experts say this is a good time to buy the shares because the price may go up again. They believe the price could reach ₹850-₹900, but it may take more than a year. Tata Motors’ cars in India are still selling well, and the company is planning to become debt-free. A company called CLSA says Tata Motors’ shares are cheaper than they should be.  

Tata Motors’ share price has been falling for a long time. It has dropped 44% from its highest price of ₹1,179 in July 2024. On February 25, the price went down to ₹662.10, the lowest in the past year.   

One big reason for this fall is that Tata Motors’ profits in the last quarter were not good. Jaguar Land Rover (JLR), which makes a lot of money for the company, had lower profits. Sales in important places like China and Europe were also weak. Tata Motors’ total profit fell by 22% compared to last year. Its truck and bus sales in India also went down.

Potentials: 

Tata Motors wants to make more electric cars in the future. The company plans to invest a lot of money to make electric cars popular. By 2030, it wants 20 out of every 100 cars it sells to be electric. By 2026, it will launch 10 new electric cars. It will also use sunlight and wind to make and charge these cars. Tata Motors wants to stop polluting the air. It aims to make passenger cars pollution-free by 2040 and trucks by 2045. The company is also working on using special fuels like hydrogen and biofuels for big vehicles. It plans to connect electric cars with solar panels on rooftops to save energy. In the next two years, Tata Motors will open more shops to sell electric cars in 50 cities. It will also make better electric cars that cost the same as petrol and diesel cars. By 2030, it wants half of its electric car owners to use solar energy at home.  Tata Motors is also designing new cars. One example is the Avinya, a car that looks like a mix of an SUV, a hatchback, and a big family car. 

Analyst Insights: 

Tata Motors is a strong company with good financial numbers. Its total market value is ₹2,43,620.92 crore. The company’s P/E ratio is 7.65, which means its stock price is low compared to its earnings. It gives a dividend yield of 1.89%, meaning shareholders get some money back. Tata Motors earns good profits, with a Return on Capital (ROCE) of 20.11% and a Return on Equity (ROE) of 18.1%. The company also pays out 0.45 of its profit as dividends. The company has reduced its debt, which is a good sign. Over the last five years, it has grown its profit at a fast rate of 93.1% per year. However, its tax rate is low, which could be something to watch. Another concern is that the company’s promoters (main owners) have sold some of their shares in the last three years, reducing their stake by 3.83%. 

Tata Motors is a strong company, but its stock price has dropped a lot recently. The company is making good profits and has reduced its debt. It is also investing ₹18,000 crore in electric cars and wants to capture 20% of the market by 2030. However, its luxury car brand, Jaguar Land Rover (JLR), is not doing well in some countries, and there is tough competition from Mahindra & Mahindra and Tesla. Despite these challenges, experts believe the stock will recover in the long run.However, short-term traders should be careful as the price may continue to fluctuate. 

Tata Power Q3 FY25 Results
Tata Power Q3 FY25 Results: 10% Increase in Net Profit to ₹1,188 Crore | Key Business Segments & Renewable Energy Expansion

Tata Power Ltd: Overview 

Tata Power Ltd. is one of India’s largest integrated power companies, engaged in power generation, transmission, and distribution. With a legacy of over a century, the company has established itself as a key player in conventional and renewable energy sectors. Tata Power has a diversified portfolio, including thermal, hydro, solar, and wind energy, along with power trading and distribution. The company is focused on transitioning towards cleaner and sustainable energy solutions, aligning with India’s renewable energy goals. Tata Power has been instrumental in the development of solar rooftop solutions, electric vehicle (EV) charging infrastructure, and smart metering services. It is also actively engaged in energy storage solutions, micro grids, and grid modernization projects to enhance efficiency. The company’s continuous efforts in technological innovation, digital transformation, and customer-centric services have reinforced its leadership position in India’s power sector. The Indian power sector is undergoing a massive transformation, driven by policy reforms, increasing demand for clean energy, and technological advancements. The government’s push for renewable energy, with a target of 500 GW by 2030, has created vast opportunities for companies like Tata Power. The rapid adoption of electric vehicles (EVs) is also fuelling demand for charging infrastructure, an area where Tata Power has taken an early lead. Additionally, energy storage solutions, smart grids, and digitalization are emerging trends that are shaping the future of the power industry. Rising coal prices, fuel supply constraints, and regulatory challenges remain key concerns for the thermal power segment, but increasing investments in renewable energy and decarbonization initiatives are mitigating these risks. 

Latest Stock News 

India has one of the lowest per capita power consumption rates, highlighting significant growth potential in the energy sector. The country’s total installed renewable energy capacity currently stands at 462 GW, with 5.2 GW added in December 2024 and a total of 20.0 GW added during the first nine months of FY25. Tata Power Renewable Energy Ltd. (TPREL) commissioned one of India’s largest floating solar projects, a 126 MWp installation in Omkareshwar, Madhya Pradesh, further strengthening its renewable portfolio. TP Solar secured a ₹455 crore contract to supply 300 MWp ALMM modules to Maharashtra State Power Generation Company Limited, reinforcing its position as a key supplier in India’s solar industry. Additionally, Tata Power Trading Company Ltd. (TPTCL) partnered with Noida International Airport to supply 10.8 MW of wind power, supporting the airport’s sustainability initiatives. In a major financing development, Tata Power signed a Memorandum of Understanding (MoU) with the Asian Development Bank for US$4.25 billion to fund critical clean energy projects. During the quarter, Tata Power executed 467 MW of projects, reflecting its strong project execution capabilities. In the rooftop solar segment, the company’s order book remains robust, with 134 MW of solar rooftop capacity installed in Q3 FY25. Its distribution network continues to expand, surpassing 560 channel partners across more than 400 districts, further enhancing its market reach and accessibility. 

Business Segments 

  • Generation: Tata Power has a total installed capacity of over 14 GW, comprising thermal, hydro, solar, and wind energy. The company’s focus on renewable energy has led to significant capacity additions, with an increasing share of solar and wind power. Its coal-based thermal plants in Mundra, Trombay, and Jojobera continue to contribute to base-load power generation, ensuring stability in supply. The company also operates hydroelectric power plants in Maharashtra and other states, supporting clean energy initiatives. 
  • Renewable Energy: Tata Power Renewables is a major contributor to India’s green energy transition, with over 4.2 GW of renewable capacity, including utility-scale and rooftop solar projects. The company is actively expanding its solar EPC business, catering to industrial, commercial, and residential consumers. Tata Power’s focus on hybrid energy solutions and floating solar projects is expected to further boost its renewable portfolio in the coming years. 
  • Transmission and Distribution: Tata Power operates transmission networks and distributes power across multiple cities, including Mumbai, Delhi, and Odisha. The company has been a pioneer in implementing smart metering, demand-side management, and advanced grid solutions to enhance reliability and efficiency. Through partnerships with state governments and private entities, Tata Power is continuously expanding its distribution footprint. 
  • Electric Vehicle (EV) Charging Infrastructure: Recognizing the rising adoption of EVs, Tata Power has established itself as a market leader in EV charging solutions. The company has installed over 5,000 charging stations across India, covering highways, residential areas, and commercial hubs. Its expansion in this segment aligns with India’s push for sustainable mobility. 
  • Energy Services & Storage Solutions: Tata Power is also investing in energy storage technologies, including battery energy storage systems (BESS), micro grids, and grid-scale solutions. These initiatives aim to enhance grid stability and support renewable integration. 

Subsidiary Information 

  • Tata Power Renewable Energy Ltd. (TPREL): This subsidiary focuses on developing and managing renewable energy assets, including solar and wind projects. It has been a key driver in Tata Power’s goal to expand its green energy capacity. TPREL has been actively securing large-scale solar projects through government tenders and private-sector collaborations. 
  • Coastal Gujarat Power Ltd. (CGPL): CGPL operates the 4,000 MW Mundra Ultra Mega Power Plant (UMPP), one of India’s largest coal-fired power stations. Despite challenges due to rising fuel costs, CGPL plays a critical role in providing reliable power to multiple states. The company is also exploring cleaner energy solutions to reduce its carbon footprint. 
  • Tata Power Delhi Distribution Ltd. (TPDDL): This joint venture with the Delhi Government is responsible for power distribution in North Delhi. TPDDL has been at the forefront of smart grid implementation, reducing power losses and improving service efficiency. The company has also been actively involved in demand-side management programs to enhance energy conservation. 
  • Tata Power Solar Systems Ltd.: As one of India’s leading solar EPC players, Tata Power Solar specializes in solar module manufacturing, rooftop solar installations, and large-scale solar farms. The company has undertaken several prestigious projects across the country, reinforcing its position as a key player in India’s solar energy sector. 
  • Tata Power Trading Company Ltd. (TPTCL): This subsidiary is involved in power trading and energy management solutions. TPTCL facilitates the sale and purchase of power across different regions, optimizing supply-demand balance and ensuring efficient utilization of generation capacity. It plays a crucial role in providing open access solutions to industries and commercial enterprises. 

Q3 FY25 Earnings 

  • Revenue of ₹15391 crore in Q3 FY25 up by 5.05% YoY from ₹14651 crore in Q3 FY24.  
  • EBITDA of ₹3079 crore in this quarter at a margin of 20% compared to 16% in Q3 FY24. 
  • Profit of ₹1188 crore in this quarter compared to a ₹1076 crore profit in Q3 FY24. 

Financial Summary 

Amount in ₹ Cr Q3 FY24 Q3 FY25 FY23 FY24 
Revenue 14651 15391 55109 61449 
Expenses 12334 12312 47381 50714 
EBITDA 2417 3079 7728 10735 
OPM 16% 20% 14% 17% 
Other Income 1092 589 5540 3416 
Net Profit 1076 1188 3810 4280 
NPM 7.3% 7.7% 6.9% 6.9% 
EPS 2.9 3.2 10.4 11.6 
Ashok Leyland: Gears Up to Launch Hydrogen-Powered Truck in 2 Years

Date: October 7, 2024

Executive Summary

Ashok Leyland Ltd. (NSE: ASHOKLEYNSE) is a leading player in India’s commercial vehicle and defense sectors. As of the latest market close, its stock is priced at ₹222.42, reflecting a decrease of ₹2.97 (-1.32%). With a market capitalization of ₹661.72 billion and a P/E ratio of 27.05, the company faces an evolving market environment. Ashok Leyland’s innovation focus and advancements in alternative fuel vehicles offer promising future prospects. This report provides a detailed analysis of the company’s financials, strategic growth plans, and the latest developments in green mobility.

Latest Developments

Hydrogen-Powered Truck Launch and Electric Truck Deliveries

Hydrogen-Powered Truck:
On October 2, 2024, Ashok Leyland announced its plans to commercially launch India’s first hydrogen-powered truck within the next 18-24 months. This follows the unveiling of India’s first hydrogen internal combustion engine (H2-ICE) powered heavy-duty truck, in collaboration with Reliance Industries, in February 2023. The company is positioning itself as a leader in green transportation, with hydrogen-powered vehicles representing a significant step towards sustainable energy solutions.

Electric Truck Deliveries:
On the same day, Ashok Leyland commenced delivery of 180 electric trucks to Billion Electric Mobility, marking the largest single order of electric trucks in India to date. The vehicles, including the BOSS Electric Truck and the AVTR 55T Electric Tractor, will be deployed on key routes, such as Chennai-Bengaluru and Chennai-Vijayawada. The company has also announced plans to expand production of electric trucks at its Hosur plant, focusing on alternative energy vehicles.

CEO Shenu Agarwal’s Statement:
“Ashok Leyland is committed to pushing the boundaries of innovation, leading the shift to green mobility. Our BOSS ICV Electric trucks and AVTR 55T Electric Tractors represent cutting-edge technology aimed at enhancing the customer experience and promoting sustainability,” Agarwal said.

These strategic initiatives reflect Ashok Leyland’s commitment to offering eco-friendly mobility solutions and revolutionizing India’s commercial vehicle industry through green technology.

Company Overview

Founded: September 7, 1948
Headquarters: Chennai, India
CEO: Shenu Agarwal
Employees: Approximately 31,770 (FY)
Website: ashokleyland.com

Ashok Leyland Ltd. is a dominant player in the manufacturing and sale of commercial and defense vehicles. With its recent advancements in hydrogen and electric vehicle technologies, the company is positioning itself for long-term growth in sustainable mobility.

Stock Performance

  • Current Price: ₹222.42
  • Day’s Change: -₹2.97 (-1.32%)
  • Market Capitalization: ₹661.72 billion
  • Dividend Yield: 0.00%
  • P/E Ratio (TTM): 27.05
  • Basic EPS (TTM): ₹8.34

The stock has experienced a slight decline in recent trading sessions. Investors should monitor the P/E ratio relative to industry peers to assess valuation attractiveness.

Fundamental Analysis

Key Metrics

  • Market Capitalization: ₹661.72 billion
  • Enterprise Value: ₹661.72 billion
  • Price-to-Sales (P/S) Ratio: 1.41x
  • Net Income: Data pending
  • Revenue: Data pending

Ownership Structure

  • Free Float Shares: 1.76 billion (59.89%)
  • Closely Held Shares: 1.18 billion (40.11%)

Ashok Leyland’s ownership structure shows a strong free float, enhancing liquidity for investors, though the significant portion of closely held shares could influence stock volatility based on insider activity.

Valuation

Ashok Leyland’s P/E ratio of 27.05x suggests that investors are paying ₹27.05 for every ₹1 of earnings, which is relatively high compared to industry standards. The P/S ratio of 1.41x aligns with a fair valuation relative to its revenue.

Historical Valuation Trends

  • 2019-2023 P/E Ratio: An upward trend in valuation reflects increased investor confidence and earnings growth.
  • P/S Ratio: Steady growth, indicative of expanding revenue.

Financial Health

Debt and Coverage

  • Debt Level (2023): ₹450 billion
  • Free Cash Flow: Data pending
  • Cash & Equivalents: Data pending

Ashok Leyland maintains significant debt, which will require close attention as the company expands into hydrogen and electric vehicle production. Managing cash flows and debt servicing capabilities will be key to ensuring long-term financial health.

Asset and Liability Structure

  • Total Assets (2023): ₹400 billion
  • Total Liabilities (2023): ₹450 billion

Liabilities exceeding assets raise potential solvency concerns, and investors should monitor the company’s strategies for reducing debt.

Growth Prospects

Green Mobility Initiatives

  • Hydrogen-Powered Trucks: The expected launch of the first hydrogen-powered truck in 18-24 months marks a significant development for the company and India’s shift towards sustainable transportation.
  • Electric Truck Production: With new electric vehicle models being delivered, and specialized assembly lines planned for the Hosur plant, Ashok Leyland is poised for growth in the electric commercial vehicle segment.

Revenue Streams

  • By Source:
    • Commercial Vehicles: Dominates revenue generation.
    • Financial Services: Offers additional revenue streams.
  • By Geography:
    • India: Primary market with strong growth potential.
    • International: Expanding presence globally.

Risks

  • Debt Levels: High liabilities could strain financial flexibility.
  • Market Competition: Intense competition in the commercial vehicle sector may impact market share.
  • Economic Slowdown: A decline in economic activity could reduce demand for commercial vehicles.
  • Regulatory Changes: New environmental and safety regulations could lead to increased compliance costs.