Shares of Timken India hit an all-time high at ₹2,879.60 per share on the BSE in Wednesday's intraday trade. At 01:30 pm, the scrip traded at ₹2,807.60 around 0.69 per cent above its previous close of ₹2,788.45.
The stock rose for six consecutive trading sessions. The stock price went from ₹2,527 to ₹2,788.45 in the last 10 trading sessions, delivering a return of 10.38 per cent.
The Timken India share price went from ₹1,964 to ₹2,788.45, delivering a return of over 41.95% since its Q4 result announcement on May 27.
Furthermore, the stock gained more than 87.3% in the last one year, in contrast to the movement in the Nifty50 index, which has increased by 5.15% in the same period.
The stock's market price has increased by 302.74 per cent in the last three years. The company commands a market capitalization of Rs. 21,153.01. It has an EPS of Rs. 43.47.
Timken India is primarily into the manufacture and distribution of tapered roller bearings, components and accessories for the automotive sector and the railway industry. It also provides maintenance contract services and refurbishment services.
Timken India Limited (TIL) was incorporated in 1987 as Tata Timken Limited (TTL), a joint venture between Tata Iron and Steel Company (TISCO) and The Timken Company, a world leader in bearings. Timken acquired from Tata Steel its 40% stake in Tata Timken Limited. The name of the Company was changed to Timken India Limited, Its website shows.
Timken's net profit surged 128.87 per cent YoY to ₹121.30 crore, which is one of the highest in the industry, Trendlyne data showed. The revenue from operations rose 39.19 per cent to ₹672.3 crore, as against ₹483.2 crore in the corresponding quarter of the preceding fiscal.
For the fiscal year ending March 31, 2022, Timken has reported a two-fold jump in its consolidated net profit at ₹327.1 crore. It reported a net profit of Rs. 143.2 crore in FY21.
Its operating revenue increased by 55.03 per cent year on year to ₹2,217.5 crore. It was ₹1,430.1 crore in the financial year 2020-21.
The company delivered an ROE of 19.74% in the year ending March 31, 2022, outperforming its five-year average of 14.46%. The return on capital employed increased from 13.54 per cent to 25.06 per cent year on year.
On June 30, 2022, JM Financial initiated coverage on Timken with a 'buy' rating and a target price of ₹2,700. The brokerage noted that the valuation gap for Timken has narrowed vs. other bearing companies on a PER basis given the following:
The decline in the share of traded goods YOY due to the share of exports, aiding margin expansion and better return ratios on the back of operating leverage benefits as capacity utilisation improved and improvement in pay-out ratio, though it is still lower vs. peers, ET reported.
The company saw its FII holdings rise from 2.9% in March 2021 to 3.6% in March 2022. While the promoters hold 67 per cent of the shares in the company, mutual funds hold 11.58 per cent of the shares, and regular shareholders own 15.93 per cent.
An average of five analysts polled by MintGenie have a 'buy' call on the stock.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.