Rs 2,070 Crore Order Book: Solar Pumps Company Expands into the EV Sector by Incorporating a Wholly Owned Subsidiary
The stock gave multibagger returns of 1,225 per cent in 2 years and a whopping 2,000 per cent in 5 years.
Shakti Pumps (India) Ltd has invested Rs 3,00,00,000 in its wholly owned subsidiary, Shakti EV Mobility Private Limited (formerly known as Shakti Green Industries Private Limited), by subscribing to 30,00,000 equity shares of a face value of Rs 10. This investment increases the consolidated investment in Shakti EV Mobility to Rs 35,00,00,000. Shakti EV Mobility, incorporated on December 16, 2021, has a total asset size of Rs 3,723.92 lakh as of March 31, 2024. The company is engaged in the manufacturing of various types of electric vehicle motors and chargers/controllers.
This investment aims to initiate and expand the business of Shakti EV Mobility. As a wholly owned subsidiary of Shakti Pumps, this transaction does not fall under related party transactions. No governmental or regulatory approvals are required for this same-day acquisition. The investment is made in consideration of equity shares, with a cost of Rs 3 crore. The equity shares will be issued from time to time as per the agreement. Shakti EV Mobility manufactures electric vehicle motors for two-wheelers, three-wheelers, four-wheelers, special-purpose electric vehicles, and other applications, as well as chargers for electric vehicles. The company has a presence in India and reported a turnover of Rs 430.09 lakh as of March 31, 2024.
Earlier, Shakti Pumps announced a new partnership with ReNew Photovoltaic Private Limited for the supply of DCR cell-based solar modules, valued at Rs 1,300 crore. This deal supplements their existing collaborations with Mundra Solar PV Limited (Adani) and Premier Energies Ltd., also for DCR cell-based solar modules. The company's expanded network of suppliers is anticipated to significantly boost growth and solidify Shakti Pumps' leading position in the market, demonstrating its commitment to expansion and sustained success. Additionally, the company secured a significant order from the Haryana Renewable Energy Department (HAREDA) under the Component B of the PM-KUSUM scheme. The order entails the supply, installation, and commissioning of 3,174 solar water pumping systems. The total value of the order, excluding GST, is Rs 102.25 crore and including GST, it amounts to Rs 116.36 crore.
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About the Company
Shakti Pumps, a leading Indian manufacturer of pumps and motors for various applications like irrigation and domestic water supply, has been at the forefront of innovation with its well-regarded "Shakti" brand. Founded in 1982, they specialize in energy-efficient pumps including solar options and manufacture a wide range of components in-house for complete solar pump solutions. Committed to sustainability and transforming agriculture, Shakti Pumps exports its products to over 100 countries and is India's first 5-star rated pump manufacturer.
The company has a market cap of Rs 11,033 crore and as of December 31, 2024, the company has an unexecuted order book of Rs 2,070 crore. In Q3FY25, the company witnessed strong growth across key financial metrics. Revenue from Operations surged by 30.9 per cent YoY to Rs 648.80 crore, driven by robust order execution. This translated into a significant EBITDA growth of 117.6 per cent YoY to Rs 154.40 crore, with margins expanding by 938 bps to 23.8 per cent. Consequently, PAT witnessed a remarkable 130.2 per cent YoY growth to Rs 104 crore, resulting in a healthy 16 per cent margin. This strong performance was further reflected in the 9MFY25 results. Revenue jumped to Rs. 1,850.90 crore, a substantial increase from Rs 761.50 crore in the same period last year. EBITDA grew significantly to Rs 439 crore, with margins expanding to 23.7 per cent. Similarly, PAT soared to Rs 298.10 crore, a remarkable YoY growth, with margins improving significantly to 16.1 per cent.
Furthermore, the shares of the company ex-traded bonus Shares in the ratio of 5:1, i.e., 5 new fully paid-up equity shares for every 1 existing fully paid-up equity share. The ex-date for bonus shares was Monday, November 25, 2024. The stock gave multibagger returns of 1,225 per cent in 2 years and a whopping 2,000 per cent in 5 years. Investors should keep an eye on this solar pump stock.
Disclaimer: The article is for informational purposes only and not investment advice.