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Sowmya Sundar

AT Rs 325, the stock of Shanti Gears trades at eight times its trailing 12 month per share earnings. Considering the impressive growth recorded by the company over the past 12 quarters and the expected growth, valuations appear attractive. One can accumulate the stock.

Shanthi Gears makes gearboxes, gear wheels and gear motors used in various industrial applications. Its strong presence in growing markets such as textiles and power could provide the necessary growth impetus. Over the last year, Shanti Gears has significantly increased its overseas exposure. It has also been looking at outsourcing contracts. A widespread product portfolio gives it a better chance to take advantage of investments in various sectors.

The company had announced a stock split and a bonus issue, which is yet to take effect. This could increase the liquidity in the stock, which was a major deterrent so far.

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