The new finance bill has doubled the tax on royalty – For gabriel that should have minimal impact, assuming royalty is paid to the us partner (1.55Cr). The bigger management fees, the legal and professional charges (52.133Cr) are actually paid to the Anand group which is an Indian entity. So over all impact should be less. Ola recall impact should be done, its only short term as the ability of Gabriel India to provide a redesigned front fork in record time is a good thing and Ola is likely to remain a customer. General market is tight with the liquidity tightening and interest rate shoot up(and its effect on banks and other institutions) in developed markets. So pressure on share prices may continue for some more time, while market waits for more and more signs of disinflation in developed markets. However, I repeat w.r.t its capabilities corporate governance (except for the way the management fee is collected) company is solid and well poised to grow faster in coming years.
Disc: invested.
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