Sona BLW Precisions Forgings shares rallied as much as 11% to an intra-day high of Rs 714. The surge in stock price came a day after the auto components maker reported a 16% jump on year in its net profit standing at Rs 143.57 crore in Q2 FY25, compared to Rs 124.06 crore in Q2 FY24.
The company’s revenue from operations stood at Rs 922.18 crore, up 17% on year in Q2 FY25 against Rs 787.46 crore in Q2 FY24.
Along with Q2 results, the company has also signed a pact with Escorts Kubota to acquire the latter’s railway business.
“…the Railway Equipment Division of EKL (RED), as going concern, on slump sale basis, for an enterprise value of INR 1,600 Crore (Rupees one thousand six hundred crore), subject to the terms of the Agreement. RED is a leading supplier of critical components for Railways, such as brakes and suspension systems for various rolling stocks. RED reported revenue of approx. INR 950 crore and approx. EBIT of INR 179 crore in FY24. The proposed acquisition of RED is expected to be earnings accretive for Sona Comstar right from the first year and offers significant growth opportunities,” said the company in an exchange filing.
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Sona BLW’s performance in Q1
The company reported a 26.7% year-on-year growth in net profit that came in at Rs 141.9 crore for the first quarter of FY25. The company’s revenue from operations increased by 21.8% to Rs 891.2 crore in comparison to Rs 731.4 crore in the corresponding period of the last fiscal.
Sona BLW Vs Nifty 50
The stock of auto components maker has given 11% in the past five trading sessions. However, the stock has fallen almost 4% in the last one month. It has given a bit over 6% of return in the last six months. The stock has risen 10% from year to date and raised investors’ wealth by 38% in the last one year.
To compare, the benchmark index Nifty 50 has fallen 0.7% in the last five trading days. It has raised investor’s wealth by almost 6% in the last one month. However, the index has risen 9% in the last six months.
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