- 06 Nov 2024
- ICICI Securities
STEEL STRIPS WHEELS LAUNCHES NEW PRODUCT, COURT RULES IN FAVOUR OF ELIGIBILITY FOR FISCAL INCENTIVES
News: In a Press Release, Steel Strips Wheels Limited has announced significant developments following the Hon'ble Supreme Court of India's dismissal of a Special Leave Petition by the State of Jharkhand on November 4, 2024, which allows the company to claim a capital investment subsidy and other fiscal incentives totalling ₹31 crores, including interest. Concurrently, the company has launched a new product, the Aluminium Steering Knuckle, commencing its commercial production at the company’s existing manufacturing facility located in Mehsana, Gujarat, effective November 5, 2024, aimed at the domestic automotive market.
Views: These are positive developments for the company. On the recent P/L performance, the growth has been below expectation with only solace being healthy CFO generation and consequent reduction in debt on company’s B/S. At the CMP, the stock trades inexpensive at ~<12x PE on FY26E with 15%+ return ratios profile. We don’t see further downside in share price for Steel Strips Wheels.
Impact: Positive