1:2 Sub-Division On January 31; Auto Stock That Gained 25,695%, To Split For Third Time; Attractive Or Not?

JBM Auto, a mid-cap automobile company, is all set to split for the third time since listing on BSE and NSE. The upcoming stock split by JBM Auto is of 1:2 ratio, where its face value of Rs 2 each will be sub-divided to Rs 1 each. JBM holds a strong record of dividends, bonus and splits since past two decades, apart from its share price registering an all-time gains of a whopping 25,695.05% so far.

JBM Auto Ltd Share Price:

The start of 2025 has been broadly bearish. The stock has corrected by over 5.5% YTD, with its latest weekly performance down by over 6% on BSE. After market hours of January 10, JBM Auto shares stood at Rs 1468.50 apiece, down by 1.6% with a market capitalisation of Rs 17,364.59 crore.

The stock's 52-week high and low is at Rs 2,417.30 apiece and Rs 1,387.95 apiece on BSE. Despite the latest correction in a year, JBM Auto stock has given massive returns in the longest run. JBM's 5-year performance is huge by 1,387.95% gains on BSE, while its all-time returns is mind-boggling by 25,695.05%.

JBM shares were merely at Rs 5.66 per share on December 17, 2004, once upon a time.

Is JBM Auto Stock Attractive?

The fundamentals of this auto stock are a mixed bag, with a high PE ratio and debt-to-equity ratio, however, ROE has been stable. As per Trendlyne data, the following are the fundamentals for JBM Auto stock analysis:

- Price to Earning Ratio is 92.49, higher than its sector PE ratio of 32.45.

- Stock Price fell 22.9% and underperformed its sector by 45.85% in the past year.

- Debt to Equity Ratio of 1.8 is higher than 1. This implies that company assets are financed through debt.

- Return on Equity(ROE) for the last financial year was 15.31%, in the normal range of 10% to 20%.

- Mutual Fund Holding increased by 0.01% in the last quarter to 0.06.

- Promoter Share Holding stayed the same in the most recent quarter at 67.53%.

- Interest Coverage Ratio is 3.07, higher than 1.5. This means that it is able to meet its interest payments comfortably with its earnings (EBIT).

- Promoter Pledges are zero.

JBM Auto Stock Split:

The stock is going to be in focus ahead due to its third stock split. On January 10th, the company fixed Friday, 31 January, 2025 as the "Record date" for determining the eligibility of members for the purpose of sub-division/Split of the equity shares of the Company from Face Value of Rs. 2/- each fully paid-up to Face Value of Re. 1/- each fully paid-up.

Hence, the upcoming stock split is of 1:2 ratio. JBM has already split twice in the last 10 years. The first stock split was in October 2014, in the ratio of 1:2, under which the face value of Rs 10 each was split to Rs 5 each. The second stock split was after pandemic in February 2022, in the ratio of 5:2, where the face value of Rs 5 each was split to Rs 2 each.

Here's how investors will gain if they have held JBM Auto shares throughout the three stock split. The example is excluding the gains from bonus shares and dividends.

For example: If 500 shares of JBM Auto were bought before the first stock split record date which was on October 18, 2014.

First Stock Split (1:2): Then 500 shares will multiply to become 1,000 shares (500x2/1). In the ratio of 1:2, the number of shares doubles while the face value per share halves.

Second Stock Split (5:2): If 1,000 shares held till second stock split, then the number of shares will multiply to 2,500 shares (1,000 X 5/2 ).

Upcoming and third stock split: Let's suppose the 2,500 shares are held till the upcoming stock split record date, then the number of shares in JBM would become 5,000 shares (2,500 2/1).

Bonus Issue: JBM has carried two bonus shares so far. The first bonus reward was of 1:2 in 2007, while the second bonus reward was of 1:1 in 2014.

Dividend: JBM Auto has delivered up to 18 dividends since August 2006, as per Trendlyne data. In the past 12 months, the company rewarded about Rs 1.50 per share dividend.

About JBM Auto:

JBM Group, a $3.0bn global Indian conglomerate, has over 4 decades of excellence in driving product innovation & value across automotive, buses & electric vehicles, EV charging infrastructure, EV Aggregates, renewable energy and artificial intelligence. With modest beginnings in the early 80s, JBM has leapfrogged multi-fold with an infrastructure of 60 manufacturing plants, 5 engineering & design centres and presence in 36 countries globally.