One of the small-cap stocks engaged in the manufacturing of engines, engine applications, and trading of power tillers, spares related to engines, electric vehicles, and infrastructure equipment. The stock surged by 5.30 percent after planning for an IPO of its subsidiary, Greaves Electric Mobility Limited.
Stock Price Movement:
In Wednesday’s trading session, Greaves Cotton Limited‘s share jumped to an intraday high of 5.30 percent from the previous close of Rs. 186.85. The stock opened at Rs. 193 and is currently trading at Rs. 192.70 with a high of Rs. 196.75 and a low of Rs. 189.85. The market capitalization now stands at approximately Rs. 4,479.92 crore.
What Happened:
Greaves Cotton Limited has announced that its material subsidiary, Greaves Electric Mobility Limited (GEML), has approved the launch of an Initial Public Offering (IPO) for its equity shares, subject to shareholder approval. The IPO will include a fresh issue and offer for sale, with details to be finalized in consultation with lead managers.
Business Segments
Greaves Cotton operates across key sectors, including Powertrain Solutions, where it manufactures engines for petrol, diesel, and CNG applications. Its subsidiary, Ampere Vehicles, focuses on electric vehicle development.
The company also offers Aftermarket Services, providing spare parts and services, and manufactures agricultural equipment, such as power tillers, for the farming sector.
Segment Volumes
The company’s segment volumes include a 1% growth in auto, a 31% decline in non-auto, a 9% growth in engines, and strong double-digit growth in the electric mobility segment, comprising E2W and E3W. The diverse product portfolio and focus on electric vehicles seem to be driving the company’s performance.
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Recent Developments
Greaves Cotton has made significant strides in recent years to expand its portfolio and strengthen its market presence. In FY2019, the company acquired a majority stake in Ampere Vehicles, bolstering its position in the electric mobility sector.
The company also launched eco-friendly products like the eHD series of electric pumps and the Ampere Zeal electric scooter. Additionally, Greaves expanded its retail footprint by opening AutoEVmart, a multi-brand electric vehicle store in Bengaluru.
Recent quarter results and ratios:
Greaves Cotton Limited’s revenue has decreased from Rs. 727 crore in Q2 FY24 to Rs. 705 crore in Q2 FY25, which has down by 3.03 percent. The net loss of Greaves Cotton Limited has reduced from Rs. -375 crore in Q2 FY24 to Rs. -14 crore in Q2 FY25.
In terms of return ratios, the company’s ROCE and ROE should be 3.72 percent and 1.62 percent, respectively. The debt-to-equity ratio of the company is to be 0.06x, which shows the company is almost debt-free. Greaves Cotton Limited’s EPS is to be Rs. 3.19.
Company Overview:
Greaves Cotton Limited was established in 1922 and is a leading Indian engineering company providing end-to-end energy solutions. It manufactures cleantech powertrain solutions for CNG, petrol, diesel engines, gensets, farm equipment, e-mobility, and aftermarket services.
The company operates in four segments, which include engines, electric mobility, cables & control levers, and others. Its electric mobility portfolio includes two- and three-wheelers like the Ampere Primus and Greaves ELP. Greaves is committed to sustainable mobility and operates subsidiaries like Greaves Finance Limited and Greaves Technologies Limited.
Written By – Nikhil Naik
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