This month while searching for some smallcap stocks below 10000cr market cap, I came across Minda Corp which seem to fit my portfolio very much. It was in a growth sector, with good market share and clients and also it was trading at reasonable valuations. Almost all the major 2 wheeler companies are its customers from the traditional manufacturers to the new age startups with better products. But with the changing dynamics of the market it was necessary to observe the product mix. According to their presentation, almost 97% of it’s products can be used in EVs. From battery harnesses to the EV chargers, Minda Corp covers all the aspects of an EV vehicle. With more products like ac-dc convertor in charging technology and battery solution for vehicles are in huge demand. Apart from the that, the management expects the kit value of an EV to go upwards of 20000rs where now it is at 5000rs which means if they are able to maintain the number of clients or add new ones, they are aiming to 4times their current revenue which I believe will be achievable in the next 10 years. Given the month on month rise in EV sales we can safely assume than demand is shifting from traditional vehicles to EVs. A company in an industry with overall growth at over 20% will at least compund at 15%. At 22PE this seems a fair valuation. I will look for better investing opportunities in such other stocks or just stick to my portfolio and keep adding the small caps.
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