Hello here.
GNA has seen a massive rally handily beating even the bull run that thr market has had since start of the year.
This quarters results were mixed with revenue about flat qoq (50%increase yoy) and margins under pressure.
I wanted to understand the long term prospects of this company.
Seems like the majority of the revenue comes from class 8 trucks, tractors and commercial vehicles but how sustainable is that?
The move into SUV vehicles is encouraging given higher margins and another revenue stream but no numbers around that shared so far.
Finally what would be the impact of EVs on this business?
Revenue Cagr over last 5 years is around 19% but since growth is heavily dependent on infrastructure based vehicles how much growth can we expect?
Can we assume around GDP level growth- say around 6% a year which leads to just about 5% cagr over the next 5 years or are there some major tailwinds to assume a higher revenue growth rate.
Also is margin pressure a worrisome things or is it more of a short term effect and we can see increase given its leading market position?
At about 1500cr by 2026, at 8% net margin and even taking a 20 pe we’re looking at a 2400 cr market cap, which is just about a 30% increase compared to today.
Thank you.
Discl:
Holding with avg price of 250 and thinking about selling a little.
Greater than 20% of portfolio