Electric vehicle stock surged by 5% following the acquisition of a stake in the company by Porinju Veliyath.
Electric vehicle: The engine and its accessories sector in India play a crucial role in driving various industries, including automotive, power generation, agriculture, and infrastructure. As the country continues to urbanize and industrialize, the demand for reliable engines and engine-related products such as power gensets, pumps, and accessories is expected to rise. This sector has witnessed innovation with a shift towards energy-efficient solutions, including electric vehicles and green technologies.
Leading companies in this sector include Greaves Cotton, Kirloskar Oil Engines, and Mahindra Powerol, among others. With India’s increasing emphasis on sustainable development and infrastructure expansion, the engine and accessories sector are poised for significant growth, offering ample opportunities for investment and innovation. Companies are expanding their product offerings to cater to a broader range of applications, driving long-term growth potential.
Stock Performance:
Greaves Cotton Limited’s shares are currently trading at Rs. 250.2, up by 1.65% from its previous close of Rs. 246.15 as of January 28, 2025. The stock also reached an intraday high of Rs. 258.15, marking a 4.9% increase.
Recent Developments:
Renowned investor Porinju Veliyath’s Equity Intelligence India has acquired a 0.5% stake in the company, purchasing shares from the open market at an average price of ₹234.63 per share. Porinju is well-known for his successful stock-picking strategies, ability to identify undervalued stocks, long-term growth potential, and insightful market approach. His investments have consistently outperformed, earning him recognition as one of India’s most trusted and influential investors.
Q3 Financial Performance:
Greaves Cotton Ltd. exhibited robust financial performance in December 2024, with a significant increase in both sales and profitability. Sales surged from ₹665.38 crore in December 2023 to ₹750.60 crore in December 2024, indicating healthy revenue growth.
EBITDA experienced a notable increase, rising from ₹35.36 crore to ₹39.67 crore, leading to an enhanced operating profit margin (OPM) that climbed from 4.27% in December 2023 to 5.29% in December 2024.
On the other hand, net profit saw a significant decline, dropping from ₹46 crore in December 2023 to ₹7 crore in December 2024. It is worth mentioning that the unusually high net profit in the previous year was partially due to the sale of exceptional items, resulting in a one-time boost.
About the Company
Greaves Cotton is a prominent company involved in the manufacturing of engines, engine applications, and the trading of related products. Specializing in diesel, petrol, and CNG engines, as well as power gensets and power tillers, the company offers non-automotive engines ranging from 1.5 HP to 700 HP for various industries. In FY24, the engine segment represented 61% of total revenue, slightly lower than the 64% in FY22, indicating a diversification in its product range.
Furthermore, Greaves Cotton is expanding its footprint in the electric vehicle (EV) and infrastructure equipment sectors, establishing itself as a key player in India’s evolving EV and infrastructure landscape. With a wide range of offerings catering to diverse industries, the company continues to achieve steady growth.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.