Debt-free stocks to pay 1200% dividend, mutual fund stake in Q3: Buy?

Schaeffler India Dividend

Declaring its Q3FY23 earnings, Schaeffler India declared a dividend of 1200% or Rs. 24/- per equity share of face value of Rs. 2/- each. The Company will close its Share Transfer Books and Register of Members from Wednesday, April 12, 2023 to Tuesday, April 18, 2023 in preparation for its 60th Annual General Meeting and to compile a list of its shareholders. Eligible for dividend payment. Moreover, the dividend ex-date of Schaeffler India is falling on April 11, 2023, as per BSE.

Schaeffler India’s third quarter earnings

17.8% annual growth from 1523.20 cr in Q3 FY22 1794.65 Cr was reported by the company as its revenue from operations in Q3FY23. The company said its net spend has reached 1,503.35 crore during the quarter ended December 2022, up 16.71% YoY 1288.10 Cr was recorded in the year-ago quarter. Company’s net income increased by 21.2% year-on-year 230.98 crore in the quarter ending December 2022 190.64 crore in the quarter ended December 2021, while the PAT margin stood at 12.9%. As compared to Q3FY22’s EPS of Rs. 12.2 The EPS of Schaeffler India in Q3 FY23 was 14.8.

sheffler india share price

Shares of Scheffler India on NSE on Friday Down 1.79% from its previous close of 2,940 2,993.60. The stock has given multibagger return of 175.77% in last five years and 217% in last three years. The stock has appreciated 61.24% over the last year, and it has climbed 8.06% year to date (YTD) in 2023. The stock has touched a 52-week high. 3,969.85 (15-Sep-2022) and hit a 52-week low 1,650.05 on (07-Mar-2022). During Q3FY23, the company recorded promoter shareholding of 74.13%, FII holding of 4.81%, DII holding of 15.04% and public holding of 6.02%.

Promoters holding unchanged at 74.13%, while FII/FPI holding decreased from 5.74% in Sep 2022 quarter to 4.81% in Dec 2022 quarter FII/FPI investor numbers decreased from 291 in Q2FY23 to 268 in Q3FY23 As per Trendline data, the holding of mutual funds has increased from 13.07% in Q2FY23 to 13.91% in Q3FY23 and the holding of institutional investors has decreased from 19.93% in Q2FY23 to 19.86% in Q3FY23. Schaeffler India has a debt-to-equity ratio of zero, making it a debt-free company, with a return on equity (ROE) of 20.5% in FY22 and a PEG ratio of 0.45.

Buy Schaeffler India?

“After reporting good performance in Q3FY2023, the company has enhanced its capex program and is guided for a capex of Rs. 1,500 crore over CY2022-CY2024E as against the earlier plan of Rs. 1,000 crores 1,200 crores. Increasing capex will improve localization and hence, profitability on the shift from opex (outsourced products) to capex. Though the export markets are facing headwinds, the company indicates a healthy traction in exports owing to its strategic initiatives, localization and relocation strategy in the overall group. Scheffler is considered one of the major beneficiaries of the China Plus 1 theme, followed by global players. With a strong position in Railways and IC business, the company is focusing on EV business and is guiding to double the per vehicle content on business transition from IC to EV. While the company is facing headwinds in the overseas wind power segment, it anticipates growing opportunities in the domestic wind power segment. We remain positive on SIL due to consistent performance, rising exports, growing localization, positive outlook on domestic PV segment, traction in railway business and strong presence in aftermarket segment. We maintain our Buy rating on the stock with a TP of Rs. 3,328. The stock trades at a P/E multiple of 38.9x and an EV/EBITDA multiple of 24.4x over FY2025 estimates.”

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