Shares of auto ancillaries firm JBM Auto have been a blessing for their investors. The stock has given exceptional returns in the long term as well as has outperformed benchmarks in the near term.
The stock has surged around 13480 percent in the last 10 years from ₹5.5 in April 2012 to currently trade around ₹749. It has also given multi-bagger returns in the last 3 and 5 years, rallying 996 and 337 percent, respectively.
An investment of ₹10,000, 10 years ago, would have turned into ₹13.5 lakh now. Meanwhile, the same investment 3 and 5 years ago would have turned into ₹1.09 lakh and ₹43,700, respectively.
In the last one year as well, when the overall market sentiment was extremely volatile on the back of major headwinds like high inflation, high interest rates, lower consumption, FII outflows, and other macro concerns, the stock rose 42 percent. In comparison, the benchmark Nifty50 is down a little over half a percent in this period.
Meanwhile, the stock has also advanced 45 percent in 2023 YTD, rising 16 percent in April so far, 12.5 percent in March, 7.3 percent in February, and 3.6 percent in January.
It has also given positive returns consecutively for the last 7 months since October 2022, rising 96 percent in this time.
However, it is important to note that JBM Auto is a smallcap stock with a market cap of ₹8,904 crore.
It hit its 52-week high of ₹761.95 in intraday deals today. Meanwhile, it had hit its 52-week low of ₹361.70 in September 2022. Since then, it has advanced over 110 percent to hit its 52-week high today.
Earlier in January, JBM Auto launched its first self-designed and self-manufactured electric luxury coach called 'Galaxy' at the Auto Expo 2023 and also showcased its new series of e-buses including city buses as well as school buses.
"JBM group is the only player in the Indian market to offer an entire EV ecosystem and is committed to investing in green mobility solutions," said Nishant Arya, Vice Chairman of JBM Auto.
In the December quarter, JBM Auto reported a small 3.8 percent YoY jump in its consolidated net profit at ₹34.33 crore versus ₹33.07 crore posted in the same quarter last year. Its net sales rose 16 percent YoY to ₹953.05 crore in the quarter under review as compared to ₹821.24 crore last year. Meanwhile, its EBITDA also rose nearly 22 percent YoY to ₹114.75 crore as against ₹94.12 crore in the year-ago period.
JBM Auto manufactures and sells sheet metal components, tools, dies, and molds and buses. It is also an original equipment manufacturer (OEM) as it is engaged in the production of passenger buses. It operates through three segments: Sheet Metal Components, Assemblies & Sub-assemblies (Component Division), Tool, Dies & Moulds (Tool Room Division), and OEM Division. It offers end-to-end solutions for all business segments, including two-wheelers, three-wheelers, passenger vehicles, and commercial vehicles.
Despite the stellar return, it is important to note that smallcap stocks are high-risk stocks and not suitable for investors with a risk-averse approach. Only high-risk investors should invest in such stocks and in small weightage. While investors have made huge profits on such stocks, it is key to remain cautious and vigilant. One must contact their financial advisor before making any investment decisions.
Disclaimer: This story is for educational purposes only. Please speak to an investment advisor before making any investment decisions.