Olectra Greentech jumps 10% after net profit rises 52% YoY in Q4

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Shares of electric-bus manufacturer Olectra Greentech soared 10 per cent to Rs 711 per share in Monday’s intra-day trade, after the company registered 52 per cent year-on-year (YoY) rise in consolidated net profit to Rs 27.01 crore in the January-March quarter (Q4FY23).

The company is primarily engaged in the manufacturing of electric buses and composite polymer insulators.

So far this calendar year (CY23), shares of Olectra have rallied 44 per cent, as against 1 per cent rise in the S&P BSE Sensex, during the same period. Earlier, the stock had scaled to a 52-week high level of Rs 743 per share on March 10, 2023.

The company’s revenues grew 39 per cent YoY to Rs 375.91 crore in Q4FY23, while it was up 84 per cent for entire-FY23 to Rs 1,090.7 crore. Consolidated net profit for FY23, on the other hand, was up 86 per cent to Rs 65.59 crore, as against Rs 35.35 crore in FY22.

Commenting on the financial performance, the management said despite supply chain snags, the company’s focus continues on increasing manufacturing capacities, and technology capabilities helped maintain leadership position in the EV segment.

Analysts at Geojit Financial Services, meanwhile, recommend to accumulate the counter, given capacity expansion plans, and strong earnings growth.

“EV adoption in buses is likely to speed up in the current year, and the center plans to procure 50,000 buses with an investment outlay of Rs 1,000 crore. We initiate coverage on Olectra, with a target price of Rs 738 per share, at 35x FY25E earnings-per-share (EPS),” they wrote in an April report.

With the formation of a joint-venture with BYD (Build Your Design) China for electric buses, the company is expanding its product line in the e-mobility segment for 3-wheeler electric autos and electric truck tippers. 

That apart, the company had also bagged the biggest-ever order of 2,100 electric buses worth Rs 3,675 crore from Brihanmumbai Electric Supply and Transport (BEST) in Maharashtra.