Stock analysis on 27th March,2017: GNA Axles Ltd. is a top quality auto-ancillary (something additional to main part ) stock which is available at dirt cheap valuation and it has better earnings visibility as compared to its peers. It has the potential of delivering huge returns in 12 to 18 months. KEYDATA BUY RANGE: Rs. 190-210 TARGET: Rs. 375-400 SECTOR: Auto Ancillary FACE VALUE: Rs. 10 52 WEEK RANGE: 16-38 ABOUT THE COMPANY G N A Axles Limited is an India-based company, which is engaged in the manufacturing of auto parts. The Company manufactures auto components for the four-wheeler industry in India. It manufactures rear axles, shafts, spindles and other automobiles components for sale in domestic and foreign market. The Company's products find applications in light and heavy commercial vehicles, and off-highway vehicles. The Company has a range of axle shafts ranging from 1.5 kilograms to 65 kilograms and capacity to produce over 165 kilograms producing approximately two million axle shafts annually. Rear axle shafts are manufactured with flanges over 425 millimeters (mm). Hollow Spindles are the used in heavy commercial vehicles and specialty vehicles in Europe and North America. The Company has its manufacturing location in the state of Punjab with its unit-I at Mehtiana and unit-II at village post office (VPO) Gulbargh, Jattan.
FEW REASONS WHY WE RECOMMEND GNA AXLES LTD. 1. From last 3 Years the company's top-line has been growing at a CAGR (Compound annual growth rate) of 15%. In addition, it is one of the most undervalued stock from the auto ancillary sector. 2. The company generates its 60% revenue from exports and 40% from domestic business. It caters to customers like Escorts, John Deere and Mahindra & Mahindra etc. 3. Promoter holds 70% stake in the company along with major mutual fund companies who have invested, like HDFC, Reliance and L&T Mutual Funds.
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