India Equity Analyst - Fundamental & Thematic, Sree Capital

Sreemant Dudhoria,CFA

India Equity Analyst - Fundamental & Thematic

Fundamental Research on Listed Indian Companies

Sree Capital

Sree Capital is a platform to share fundamental research on listed Indian companies. We do this research for our own investment

Equity Bottom-Up

<ul>
<li>GNA Axles is a cyclical play driven by revival of the tractor industry in India and pre-buying in commercial vehicles(trucks) in the U.S. market.</li>
<li>A good monsoon in India in 2024 is expected to revive domestic tractor demand, while changes in emission regulations in the U.S. are likely to increase truck sales.</li>
<li>The company is currently valued at a comfortable 18x trailing P/E, with a 15% RoE and RoCE.</li>
</ul>


GNA Axles is a cyclical play driven by revival of the tractor industry in India and pre-buying in commercial vehicles(trucks) in the U.S. market.
A good monsoon in India in 2024 is expected to revive domestic tractor demand, while changes in emission regulations in the U.S. are likely to increase truck sales.
The company is currently valued at a comfortable 18x trailing P/E, with a 15% RoE and RoCE.


GNA Axles – A Positive Shift in the Business Cycle Could Be Approaching

<ul>
<li>
<a href="https://www.smartkarma.com/entities/gna-axles-ltd" target="_blank" data-smartkarma-citation="entities:28070:1" rel="noopener">GNA Axles Ltd (GNA IN)</a>  reported Q3FY25 results with Revenue/EBITDA/PAT growth of 5%, 11%, and 13%, respectively. The improvement in operating margin was driven by lower operating expenses.</li>
<li>In October 24, the company’s board approved a major capital expenditure program of INR 4 billion for manufacturing facilities and renewable energy.</li>
<li>The stock trades at an attractive valuation of 16x P/E for FY25 with 15% RoE and RoCE.</li>
</ul>



GNA Axles Ltd (GNA IN)  reported Q3FY25 results with Revenue/EBITDA/PAT growth of 5%, 11%, and 13%, respectively. The improvement in operating margin was driven by lower operating expenses.
In October 24, the company’s board approved a major capital expenditure program of INR 4 billion for manufacturing facilities and renewable energy.
The stock trades at an attractive valuation of 16x P/E for FY25 with 15% RoE and RoCE.


GNA Axles (INE934S01014): Steady Q3FY25 Earnings, Major Expansion and Sustainability Push

<ul>
<li>Favorable reservoir level, an uptick in Kharif Harvest, and strong sowing for the Rabi season are expected to drive good demand for tractors in the medium term.</li>
<li>We summarize the sales volume published by listed players Mahindra &amp; Mahindra(M&amp;M), and Escorts Kubota Limited.</li>
<li>Positive management commentary augurs well for uptick in tractor OEM stocks and related auto ancillary companies like <a href="https://www.smartkarma.com/entities/gna-axles-ltd" target="_blank" data-smartkarma-citation="entities:28070:1" rel="noopener">GNA Axles Ltd (GNA IN)</a> in medium term.</li>
</ul>


Favorable reservoir level, an uptick in Kharif Harvest, and strong sowing for the Rabi season are expected to drive good demand for tractors in the medium term.
We summarize the sales volume published by listed players Mahindra &amp; Mahindra(M&amp;M), and Escorts Kubota Limited.
Positive management commentary augurs well for uptick in tractor OEM stocks and related auto ancillary companies like GNA Axles Ltd (GNA IN) in medium term.


Monthly Sales Overview of Indian Listed Tractor Companies (December 2024)

<ul>
<li>Tractor volume continued to be strong in Feb’25.Favorable reservoir level,strong sowing for the Rabi season and government support are expected to drive good demand for tractors in the medium term.</li>
<li>We summarize the sales volume published by listed players <a href="https://www.smartkarma.com/entities/mahindra-mahindra-ltd" target="_blank" data-smartkarma-citation="entities:16441:1" rel="noopener">Mahindra &amp; Mahindra (MM IN)</a> and <a href="https://www.smartkarma.com/entities/escorts-kubota-ltd" target="_blank" data-smartkarma-citation="entities:6773:1" rel="noopener">Escorts Kubota Limited (ESCORTS IN)</a> in February 2025.</li>
<li>Positive management commentary augurs well for uptick in tractor OEM stocks and related auto ancillary companies like <a href="https://www.smartkarma.com/entities/gna-axles-ltd" target="_blank" data-smartkarma-citation="entities:28070:1" rel="noopener">GNA Axles Ltd (GNA IN)</a> in medium term.</li>
</ul>


Tractor volume continued to be strong in Feb’25.Favorable reservoir level,strong sowing for the Rabi season and government support are expected to drive good demand for tractors in the medium term.
We summarize the sales volume published by listed players Mahindra &amp; Mahindra (MM IN) and Escorts Kubota Limited (ESCORTS IN) in February 2025.
Positive management commentary augurs well for uptick in tractor OEM stocks and related auto ancillary companies like GNA Axles Ltd (GNA IN) in medium term.


Monthly Sales Overview of Indian Listed Tractor Firms – February 2025; Strong Show Continues

<ul>
<li>We compile our selection of small-cap companies based on our desired characteristics: insider buying, value, near term growth triggers and margin of safety.</li>
<li>Out top picks are <a href="https://www.smartkarma.com/entities/sarla-performance-fibers-ltd" target="_blank" data-smartkarma-citation="entities:7696:1" rel="noopener">Sarla Performance Fibers Ltd (SRPL IN)</a> , <a href="https://www.smartkarma.com/entities/quess-corp-ltd" target="_blank" data-smartkarma-citation="entities:26937:1" rel="noopener">Quess Corp Ltd (QUESS IN)</a> , and <a href="https://www.smartkarma.com/entities/gna-axles-ltd" target="_blank" data-smartkarma-citation="entities:28070:1" rel="noopener">GNA Axles Ltd (GNA IN)</a>
</li>
<li>Given the steep correction in small and mid-cap Indian stocks, all the mentioned companies have seen active insider buying in recent weeks.</li>
</ul>


We compile our selection of small-cap companies based on our desired characteristics: insider buying, value, near term growth triggers and margin of safety.
Out top picks are Sarla Performance Fibers Ltd (SRPL IN) , Quess Corp Ltd (QUESS IN) , and GNA Axles Ltd (GNA IN)

Given the steep correction in small and mid-cap Indian stocks, all the mentioned companies have seen active insider buying in recent weeks.


Shortlist of Top India Small Cap Ideas: Value, Insider Buying & Margin of Safety-February 2025

India

GNA Axles Ltd. manufactures automotive parts. The Company offers rear axle shafts, spindles, and splined Shafts for light and commercial vehicles. GNA Axles markets its products worldwide.

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GNA Axles Ltd (GNA IN)

GNA Axles – A Positive Shift in the Business Cycle Could Be Approaching

Promoter Mr. Rambir Singh has further purchased 27,955 shares from open market as disclosed on exchange between 14 to 21 Jan 2025. Source: https:/...

Sreemant Dudhoria,CFA

GNA Axles (INE934S01014): Steady Q3FY25 Earnings, Major Expansion and Sustainability Push

GNA Axles reported steady Q3FY25 results, with YoY growth in revenue and profitability. It presents a cyclical opportunity - with sales growth...

Sreemant Dudhoria,CFA

Monthly Sales Overview of Indian Listed Tractor Companies (December 2024)

Favorable agricultural conditions expected to drive demand for tractors, positive outlook for tractor OEM stocks and related companies like GNA...

Sreemant Dudhoria,CFA

Monthly Sales Overview of Indian Listed Tractor Firms – February 2025; Strong Show Continues

Strong tractor sales in Feb’25 driven by favorable factors like reservoir levels, sowing season, and government support. Positive outlook for...

Sreemant Dudhoria,CFA

Shortlist of Top India Small Cap Ideas: Value, Insider Buying & Margin of Safety-February 2025

Our top small-cap picks based on insider buying, value, near-term growth triggers, and safety are Sarla Performance Fibers Ltd, Quess Corp Ltd,...

Sreemant Dudhoria,CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

GNA Axles – A Positive Shift in the Business Cycle Could Be Approaching

Promoter Mr. Rambir Singh has further purchased 27,955 shares from open market as disclosed on exchange between 14 to 21 Jan 2025. Source: https:/...

Sreemant Dudhoria,CFA

GNA Axles (INE934S01014): Steady Q3FY25 Earnings, Major Expansion and Sustainability Push

​GNA Axles reported steady Q3FY25 results, with YoY growth in revenue and profitability. It presents a cyclical opportunity - with sales growth...

Sreemant Dudhoria,CFA

Monthly Sales Overview of Indian Listed Tractor Companies (December 2024)

​Favorable agricultural conditions expected to drive demand for tractors, positive outlook for tractor OEM stocks and related companies like GNA...

Sreemant Dudhoria,CFA

Monthly Sales Overview of Indian Listed Tractor Firms – February 2025; Strong Show Continues

​Strong tractor sales in Feb’25 driven by favorable factors like reservoir levels, sowing season, and government support. Positive outlook for...

Sreemant Dudhoria,CFA

Shortlist of Top India Small Cap Ideas: Value, Insider Buying & Margin of Safety-February 2025

​Our top small-cap picks based on insider buying, value, near-term growth triggers, and safety are Sarla Performance Fibers Ltd, Quess Corp Ltd,...

Sreemant Dudhoria,CFA

GNA Axles reported steady Q3FY25 results, with YoY growth in revenue and profitability. It presents a cyclical opportunity - with sales growth...

Favorable agricultural conditions expected to drive demand for tractors, positive outlook for tractor OEM stocks and related companies like GNA...

Strong tractor sales in Feb’25 driven by favorable factors like reservoir levels, sowing season, and government support. Positive outlook for...

Our top small-cap picks based on insider buying, value, near-term growth triggers, and safety are Sarla Performance Fibers Ltd, Quess Corp Ltd,...