1. At a Glance
What do Tata Motors, government PSUs, and 12,000 public shareholders have in common? They all trust ACGL to build the bus. India’s low-key coach builder has quietly turned into a compounder—with a 33.9% profit CAGR over 5 years. The question is: are we at the pit stop or just firing up the engine?
2. Introduction with Hook
If the auto component industry were a Bollywood cast, Bosch is the veteran superstar, Uno Minda the flashy millennial—and ACGL? The background character who ends up winning an Oscar when no one’s watching.
This Tata JV has gone from being a bus-body assembler to a midcap value story. While everyone’s chasing EV unicorns, this company is busy delivering profitable, metal-clad mass movers.
- Key Stat #1: Net Profit FY25: ₹47 Cr vs ₹3 Cr in FY22
- Key Stat #2: ROE: 20% in FY25
3. Business Model (WTF Do They Even Do?)
- Core Biz: Bus body building for Tata Motors (and some third-party clients)
- Support Biz: Pressed sheet metal parts & subassemblies for commercial vehicles
- Ownership: Jointly promoted by EDC Goa (Govt. of Goa) and Tata Motors
- Monopoly Vibes: Preferred supplier for Tata CVs, especially for buses
- Geography: All India operations from its Goa facilities—logistics efficiency, check.
Essentially, ACGL builds buses. Not the app. Not the fantasy. The real steel-on-wheels kind.
4. Financials Overview
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue (₹ Cr) | 506 | 584 | 661 |
| EBITDA (₹ Cr) | 31 | 43 | 52 |
| Net Profit (₹ Cr) | 28 | 38 | 47 |
| EPS (₹) | 45.7 | 63.0 | 76.5 |
| Dividend Payout (%) | 38% | 32% | 33% |
Narrative:
This isn’t just a revenue uptick—it’s a full-blown resurrection. ACGL tripled its profits in 3 years, doubled EPS in 2 years, and still pays out a third of it as dividends.
5. Valuation
- CMP: ₹1,762
- EPS (FY25): ₹76.54
- P/E Range: 15x (bear) – 28x (bull)
Fair Value Range:
- Bearish (15x): ₹1,148
- Base (22x): ₹1,684
- Bullish (28x): ₹2,143
Currently at 23x—market knows it’s no longer a sleepy PSU cousin.
6. What’s Cooking – News, Triggers, Drama
- Jul 2025: New Company Secretary onboarded (yawn)
- Mar 2025: EPS hits all-time high ₹76.5
- Growth Driver: Strong order flow from Tata Motors’ EV and CV expansion
- Potential Catalyst: ₹120 Cr investment on books = expansion/inorganic trigger?
- Drama: None. No boardroom chaos. No factory fires. Just Goan chill.
7. Balance Sheet
| Item | FY24 | FY25 |
|---|---|---|
| Equity | ₹6 Cr | ₹6 Cr |
| Reserves | ₹213 Cr | ₹248 Cr |
| Borrowings | ₹63 Cr | ₹86 Cr |
| Total Assets | ₹373 Cr | ₹465 Cr |
Takeaways:
- D/E ratio rising but still below 0.4 = healthy gearing
- ₹120 Cr suddenly appears in investments—could be new business line?
- Book Value = ₹417; P/B = 4.2x (not cheap)
8. Cash Flow – Sab Number Game Hai
| Segment | FY24 | FY25 |
|---|---|---|
| CFO | ₹61 Cr | ₹10 Cr |
| CFI | ₹-11 Cr | ₹-14 Cr |
| CFF | ₹-22 Cr | ₹11 Cr |
| Net Cash Flow | ₹28 Cr | ₹7 Cr |
Interpretation:
Cash from ops fell drastically in FY25 due to working capital changes. But still positive = no alarms. Slight increase in borrowings helped balance capex & payout.
9. Ratios – Sexy or Stressy?
| Ratio | FY24 | FY25 |
|---|---|---|
| ROCE | 19% | 20.2% |
| ROE | 19% | 19.7% |
| OPM | 7% | 8% |
| Cash Conversion Cycle | 33 days | 43 days |
| Debt/Equity | 0.3 | 0.35 |
Verdict:
This bus is cruising efficiently. ROE of nearly 20% with conservative leverage = rare in smallcaps. Working capital cycle has improved dramatically since FY22.
10. P&L Breakdown – Show Me the Money
| Year | Revenue (₹ Cr) | EBITDA (₹ Cr) | Net Profit (₹ Cr) | EPS |
|---|---|---|---|---|
| FY22 | 282 | 7 | 3 | ₹5.6 |
| FY23 | 506 | 31 | 28 | ₹45.7 |
| FY24 | 584 | 43 | 38 | ₹63.0 |
| FY25 | 661 | 52 | 47 | ₹76.5 |
This is not compounding. This is compound-compression with NOS injection.
11. Peer Comparison
| Company | CMP (₹) | P/E | ROCE | ROE | OPM |
|---|---|---|---|---|---|
| Uno Minda | ₹1,119 | 68.8 | 18.8% | 17.5% | 11.2% |
| Bharat Forge | ₹1,231 | 58.4 | 13.1% | 12.3% | 17.8% |
| Schaeffler | ₹4,180 | 64.3 | 25.6% | 19.2% | 18.4% |
| Endurance Tech | ₹2,695 | 45.8 | 18.2% | 15.5% | 13.4% |
| ACGL | ₹1,762 | 23.0 | 20.2% | 19.7% | 8.0% |
Conclusion:
Lowest P/E in class, despite competitive ROE & ROCE. Margin is thin, but efficiency is elite.
12. Miscellaneous – Shareholding, Promoters
- Promoter Holding: 49.77% (Tata Motors + EDC Goa)
- FIIs: Flat at 0.01%—clearly sleeping on it
- Public Holding: 50.21% — fully unlocked
- Shareholders: Up from 10.2K to 12.2K in a year—retail interest rising
- Dividend Yield: 1.4% — not thrilling, but consistent
Also, no dilution, no pledges, and the Tata tag—corporate governance gets a gold star.
13. EduInvesting Verdict™
ACGL has quietly turned itself from a bus-builder to a balance-sheet bulldozer. It’s a textbook example of smallcap operating leverage in action: thin margins, but exploding profits when volume scales.
Yes, the stock’s up ~70% in 2 years and the P/E isn’t dirt cheap anymore. But the business has structurally changed, and it’s now on investor radars.
Call it boring, call it boxy, but this bus stock is going places. And if CVs and buses remain India’s workhorse, ACGL will keep riding shotgun—efficiently, profitably, and (hopefully) dividend-y.
Metadata
– Written by EduInvesting Team | July 17, 2025
– Tags: ACGL, Tata Motors, Bus Body Building, Auto Components, Smallcap Stocks, Value Stocks, Auto Ancillary, Goa Manufacturing, EduInvesting Premium
