Shares of some leading auto and auto ancillary companies like TVS Motor Co. Ltd., Maruti Suzuki India Ltd., Ceat Ltd., and Apollo Tyres Ltd., among others, rallied on Wednesday amid the ongoing earnings season.
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Here’s a look at why some of these stocks were in focus on Wednesday:
1) TVS Motor:
The company reported a 22 percent year-on-year jump in net profit to Rs 352.8 crore for the December quarter. It posted profit margins of over 10 percent for the fifth consecutive quarter. TVS also guided for a sales volume of nearly 1 lakh units for 2022-23.
2) Maruti Suzuki: Maruti Suzuki shares rose over 1 percent after India’s largest passenger car maker reported revenue and net profit that surpassed expectations for the December quarter. The company’s EBITDA margin at 9.7 percent was the highest in 17 quarters.
3) Ceat: Shares of tyre maker Ceat were up 2 percent amid expectations of strong December quarter earnings, which will be released today. Revenue in the December quarter is expected to rise 20 percent year-on-year, while margins may improve by 300 basis points, according to the CNBC-TV18 poll. Profitability should recover led by a combination of price hikes and a decline in the raw material basket -- both crude and rubber.
4) Sona BLW Precision Forgings Ltd: Shares of Sona BLW gained over 5 percent on Wednesday after the company’s strong management commentary on CNBC-TV18. The management said that it expects 25-30 percent revenue growth in the fiscal year 2024 and intends to stay at 25 percent EBITDA margin levels. The company’s net profit rose 24 percent to Rs 107 crore in the December quarter compared to a year ago, while sales jumped 38.6 percent to Rs 685 crore.
5) Mahindra CIE Automotive Ltd: Shares of Mahindra CIE surged over 7 percent on Wednesday. The stock has rallied over 45 percent in the last six months. The recent rally was triggered after the board expressed the intent to sell off the company’s less profitable EU truck forging arm. ICICI Securities Ltd. had earlier estimated that selling off the EU truck forging would bring in Rs 500-600 crore for Mahindra CIE.