Is goldstone infratech multibagger stock? First we will analyse the electric buses scope and opportunity in India. Then we will understand the Goldstone Infratech Ltd company profile. Then we will go through the financial numbers about the company. Finally we will look at the long term goals for company.
Date: 8th January, 2018
Current Price: Rs 208.65
We will analyze this company using the standard template.
- Future potential
- Current valuation
- Past performance
Let’s understand the company and try to assess it’s future potential.
Is goldstone infratech multibagger stock?
In this section we will go through growth of electric buses in India, Goldstone infratech company profile and finally we will touch upon EV manufacturer Byd China.
Government focus on Electric vehicles:
Reiterating its commitment to the Paris Agreement, the Government of India has plans to make a major shift to electric vehicles by 2030. In fact they want to shift to electric cars by 2030 and to make India as the first country with all electric vehicles.
Two largest economies in the world are leap frogging in the usage of electric vehicles. It is not far for emerging nations to follow the footstep.
Growth of electric buses in India:
If you look at the statistics for electric buses growth in India it has been impressive in last 2 years.
- India’s first electric bus was launched in Bangalore in 2014.
- Ashok Leyland launched its electric bus in October 2016.
- Tata Motors launched its pure electric bus ‘Starbus Electric 9m’ and hybrid ‘StarBus Electric 12m’ in January 2017.
- Goldstone Infratech Supplied Himachal Pradesh Transport Corporation with 25 electric buses in September 2017.
- Brihanmumbai Electric Supply and Transport (BEST) has received 4 e-buses from Goldstone Infratech in November 2017.
Goldstone infratech company profile :
In manufacturing of Silicon rubber polymer composite insulators in India, Goldstone Infratech Limited is the market leader. Goldstone insulators are considered as superior quality insulators with a brand to reckon with. Goldstone has been a part of building the Power Transmission and distribution in India.
Company vision to support environment has led to a new phase by developing Innovative solutions in public mobility. They are now one of the leading electric bus manufacturers in India. After tie up with BYD Auto they have manufactured one of the best electric bus on Indian street.
“As an expression to this endeavor we offer green energy solution to public transport by introducing the state of the art eBus (electric Bus). These revolutionary electric buses will help fleet operators abandon fossil fuels, improve environmental quality and reduce operating costs.” Company believes.
Goldstone infratech ltd website: goldstonepower.com
Goldstone infratech ltd address:
Amarchand Sharma Complex S.D. Road
Secunderabad 500 003. A.P. INDIA
Tel: +91-40-27807640, 27806706
E-Mail ID: email@example.com
Goldstone Infratech Ltd has also three working units apart from above location.
Plot No.1 & 9; Phase-II, IDA Cherlapally
Hyderabad-500 051 Andhra Pradesh, India
Plot No. 8, IDA, Gaddapotharam
Jinnaram Mandal, Medak Dist;
Andhra Pradesh, India.
Plot No.L19 to L28,
APIIC Industrial Green park,
Rajapur, Jadcharla, Mahabubnagar (Dist),
BYD ebus , electric bus :
BYD Auto Co., Ltd. is a Chinese automobile manufacturer and a wholly owned subsidiary of BYD Company. It was founded in 2003, following BYD Company’s acquisition of Tsinchuan Automobile Company in 2002.
Its principal activity is the design, development, manufacture and distribution of automobiles, buses, forklifts, rechargeable batteries and trucks sold under the BYD brand. BYD has achieved top rankings of J.D Power’s Quality Study.
BYD was the world’s top selling plug-in electric car manufacturer with over 100,000 units delivered in 2016. In October 2016, BYD Auto became the all-time second largest global plug-in car manufacturer ahead of Luxgen. BYD Auto Wiki.
BYD will start manufacturing in India as oldstone Infratech MD N K Rawal said. Gold Stone Group is setting up a greenfield facility spending around 200 Crore. Soon you can BYD electric buses on indian roads in large numbers.
Long term vision for Goldstone Infratech :
Here is the interview with management about their long term vision. A short and edited portion is extracted from company website.
What prompted Goldstone Group to foray into electric vehicles business?
We observed that there is a global trend in favor of electromobility. We started with the first commercial EV trial in 2016. At the same time, Government of India announced Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles in India (FAME India) scheme with the objective to support hybrid/electric vehicles market development and manufacturing eco-system. All these developments helped us in developing our EV business.
We expect by 2020, 20 per cent of buses plying on India roads would be electric – with 50 per cent of urban buses being electric.
In addition to e-buses, are you planning to foray into other e-vehicle segments?
We have a long-term vision for EV business. We would be venturing into other e-vehicles segments over a period of time. At present BYD is supplying chassis and battery for our e-buses. We will plan to start manufacturing chassis in India, in collaboration with BYD, by next year.
What are your growth plans (short, medium and long term) for e-vehicles business?
Over a period of three years, we will be investing about Rs 500-750 crores. We plan to sell units in three-digit numbers per annum in the short term and hit four-digit numbers in the long run. With wider acceptance of EV, cost of important components will come down making EV production more cost-effective and ushering in green mobility in the country.
Where does Goldstone Infratech stand at present?
|Market Cap||1,013.64 Cr.|
|PBDIT Margin (%)||20|
|Net Profit Margin (%)||5.7|
|Total Debt/Equity (X)||0.75|
Profit Loss statements:
So does it mean all is well with this company? Let’s go through it’s downside risk before considering if Goldstone infratech multibagger stock or not.
Company management is one the most important factors, one must take into account while investing in any stock.
If you zoom in management ethics there few eyebrows are raised by some experts.
- Few days back company directors were arrested on a fraud case.
- There have been cases of IT Tax department raid on company premises.
- Some says there are good links with political leaders in the state.
Everybody is optimistic about the future of Electrical Vehicles but nobody can’t guarantee how successful it will really be.
You may bet on energy and enthusiastic of current government but what happens when government changes at the center and things started slowing down?
If you look at the current infrastructure of India think tanks say it is not at all possible to achieve the optimistic target of being the first nation to become fully electric vehicle nation.
Goldstone has huge dependency on BYD. what happens if there is a rift? These are some difficult questions only time will answer.
In a nutshell I am optimistic about the future of this company mainly because of below two reasons.
- India is focusing on electric vehicles more than ever now
- Goldstone infratech ltd has tied up with BYD : world’s biggest electric vehicle maker
And in my view in long term, 5 to 10 years company has the potential to provide multibagger return to its share holders.
What is your view on goldstone infratech multibagger idea? Add a comment below.