This Tata Group Stock Zooms 20%, Hits Lifetime High Post Q1 Results

In the fourth quarter of FY24, Tata group firm Automobile Corp. of Goa emerged as the standout performer with a profit growth of 41% driven by sales growth of 25%.

Market participants were widely tracking the company and how it would perform in the coming quarter.

And as you would expect, the Tata group firm did not disappoint.

In the first quarter of financial year 2025, the auto ancillary company posted robust growth.

This resulted in its stock price hitting an all-time high of Rs 2,861 on the Bombay Stock Exchange (BSE).

Key Takeaways from Q1 Results

Share price of Automobile Corporation of Goa hit the upper circuit after the company posted a massive 77% growth in its net profit to Rs 179.1 million (m) in Q1FY25.

This compared to a standalone net profit of Rs 101 million it recorded in the same period last year.

The company's revenue jumped 35% to Rs 2.1 billion (bn).

Auto Corp. of Goa's net profit and sales have now seen good growth for the fourth consecutive quarter.

In fact, the company's overall long term performance is quite extraordinary. Post pandemic, sales and net profit have seen a sharp growth between FY22 and FY24.

Financial Snapshot

Rs m, standalone	FY20	FY21	FY22	FY23	FY24
Net Sales	3,332	1,157	2,818	5,062	5,843
Growth (%)	-22%	-65%	144%	80%	15%
Operating Profit	201	-111	144	389	561
OPM (%)	6%	-10%	5%	8%	10%
Net Profit	100	-125	34	278	384
Net Margin (%)	3%	-11%	1%	6%	7%
ROE (%)	5.1	-7.2	2.1	15.4	18.6
ROCE (%)	6.9	-8.9	1.7	15.6	18.7
Dividend (Rs)	10.0	0.0	0.0	17.5	20.0
Debt to Equity (x)	0.0	0.1	0.3	0.4	0.3

Data Source: Ace Equity

Future Plans and Growth Prospects

Auto Corp of Goa is a part of Tata Motors' electric bus and hybrid bus programme.

A large portion of what the company does comes from the Tata Motors bus business, and it makes buses to suit the company's domestic and international bus requirements.

The good performance and the subsequent rise in its stock price in the past couple of months could be attributed to the company producing electric buses for the ever-growing electric vehicle segment.

The company has a capacity of around 9,000 vehicles per year, and current capacity utilisation is 70%.

With electric buses having a significantly large penetration in State Transport Undertakings, which is showing an increasing trend, this Tata company is gearing up to upgrade its manufacturing facility and engineering capability for manufacturing future models of buses, including electric buses.

Its line-up includes new models of EV buses and a prototype of an electric-powered double-decker bus.

Further, the company gained optimism stems from the belief that the listing of Tata Sons will unlock value.

Auto Corp of Goa doesn't directly hold stakes in Tata Sons. However, the company is promoted by Tata Motors, which holds about a 3% stake in Tata Sons.

How Shares of Automobile Corporation of Goa have Performed

In the past 5 days, Automobile Corp of Goa share price has surged 24%.

In a month, the stock is up 20%.

Auto Corp of Goa has a 52-week high of Rs 2,861 touched today and a 52-week low of Rs 1,250 touched on 10 August 2023.

In 2024 so far, shares of the company have rallied 104%... another Tata group stock living up to its reputation.

Here's a table comparing the Tata stock with its peers -

Comparative Analysis

Company	Auto Corp of Goa	Autoline Inds	NDR Auto	Rajratan	Rane Engine Valve
ROE (%)	18.6	15.2	17.8	17.2	10.2
ROCE (%)	18.7	23.3	24.9	19.9	10.9
Latest EPS (Rs)	63.1	4.8	27.7	10.8	16.7
TTM PE (x)	37.8	27.3	36.2	53.6	24.1
TTM Price to book (x)	6.6	4.2	5.9	8.5	2.4
Dividend yield (%)	0.8	0.0	0.4	0.4	1.2
Industry PE	55.9
Industry PB	5.2

Data Source: Ace Equity, Equitymaster

About Automobile Corporation of Goa

Auto Corp of Goa manufactures sheet metal components, assemblies and bus coaches at its factories.

It is a supplier of pressings and assemblies to Tata Motors. Tata Motors controls a 47% stake in the company.

To know more, check out the company's detailed factsheet here.

And since you're interested in Tata stock, do check out Equitymaster's Stock Screener which has a separate section for the best Tata group stocks.

Happy Investing.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...