Unveiling Rico Auto Industries: From Market Dynamics to Financial Insights

Rico Auto Industries Shares Opened Higher

On March 04, 2024, the share price of Rico Auto shot 6.57% to ₹138.60 against its previous trading session. The share opened at ₹133.65, and it touched a high of ₹143.85 and a low of ₹125.15. The stock price witnessed correction and traded in a range of ₹133 to ₹140. The stock has provided a return of ~85.38% in the past year and ~36.45% in the past 5 days as of March 04, 2024. As of March 04, 2024, Rico Auto is ranked at 1,104 with a market cap of ₹1,676 crore. Rico Auto has a TTM P/E ratio of 34.66x compared to the sector P/E of 79.22x as of March 04, 2024.

Declining Topline and Bottom Line

The auto component manufacturer posted revenue from operations of ₹3,908.10 million in Q3 FY24 against ₹4,535.50 million in Q3 FY23. Profit after tax for the quarter dropped to ₹55.50 million. The listed peers of Rico Auto include Bosch Ltd, Samvardhana Motherson International Ltd, Schaeffler India Ltd, etc.

Drop in Retail and FII’s Holdings

As of December 2023, Rico Auto Industries has a 50.34% promoter holding and 49.66% public holding. In the last 3 months, retail holdings in the company have decreased by 1.34%. As of December 31, 2023, the FII’s holding in Rico Auto Industries was 1.11%. Compared with the previous quarter, the FII holding has dropped.

Growing Demand for Auto Components Products

The automotive component industry saw a 32.8% increase in revenue between 2022 and 2023, with a turnover of ₹5.6 lakh crore (US$ 69.7 billion). In FY 2023, domestic Original Equipment Manufacturer (OEM) supplies made up approximately 66% of the industry’s turnover, with domestic aftermarket coming in second at around 12% and exports at about 22.3%. Over the next 5 years, the auto component industry is planning to make investments of around USD 6.5 to 7 billion in capacity expansion and technology upgradation.

India’s market share in the auto components business has increased dramatically, driven by the country’s exports to other countries and the rising demand for cars among the burgeoning middle class. Owing to the notable surge in demand for Indian auto components, a number of domestic and foreign companies have entered the market.