Government's EV push is electrifying some stocks

Electric vehicles (EVs)  have limited visibility on Indian roads but the government’s focus on them has led to a sharp rally in the stock prices of small-cap companies with exposure to this segment. Share prices of JBM Auto and Goldstone Infratech have more than doubled since April this year. The government in March had first mentioned its intent of making India a 100 per cent e-vehicle nation by 2030. 

Delhi-headquartered JBM Auto, a company that has been present in the automobile components space for over three decades, did not enjoy great valuations, compared to some of its peers, until recently. However, in the past one month, the stock gained 73 per cent to Rs 597, and has more than doubled since April. The company now commands a market capitalisation of Rs 2,435 crore based on Wednesday’s closing price. 
 

Nishant Arya, executive director of the firm, says they had planned to invest Rs 300 crore over four years beginning 2016, to develop e-bus manufacturing capabilities with European company Solaris. “Considering the thrust the EV business is seeing in India, we have advanced the said investment to 2-2.5 years. We have already set up the manufacturing capability for e-buses at our Kosi and Faridabad plants.”

JBM claims it is receiving enquiries from various stakeholders. “It’s only a matter of time when these enquiries will be converted into orders. We are market-ready,” said Arya. 

JBM plans to not just make e-buses but also offer solutions such as batteries and charging technology. Arya said the EV business would contribute a big chunk to the company’s top line starting next financial year. 

Hyderbad-based Goldstone Infratech caught the attention of investors when it bagged orders, from the Himachal Pradesh Road Transport Corporation in February, to sell 25 e-buses. The company’s stock price more than doubled since April to Rs182. It has also received a trial order from Brihanmumbai Electricity Supply and Transport (BEST) for six e-buses. 

Anand Swaroop, group chief operating officer at Goldstone Group, said the company was confident of selling at least 350-400 e-buses every year from next year. “We are investing Rs 400 crore over the next three years to build our capacities in electric bus manufacturing,” said Swaroop. These buses are priced at a range of Rs 2-3 crore each. 

Goldstone has a tie-up with Chinese e-bus maker BYD.  Swaroop said over 30,000 electric buses made by BYD are running in China, Europe, and other markets. 

OK Play, a Delhi-based plastic company, forayed into electric three-wheelers in 2015 and later launched electric two wheelers as well. Its stock has appreciated more than 50 per cent since April.