Stock of the day: Genus Power infrastructure
A Promising Future in the Indian Market
The financial world is buzzing with excitement as Genus Power Infrastructure's stock takes a remarkable leap, locked in a 5% upper circuit. The reason behind this surge is the recent acquisition of a significant order worth ₹3,115.01 crore for smart prepaid meters. In this blog, we will delve into the details of this development and analyze Genus Power's promising future in the dynamic Indian market.
Genus Power's Meteoric Rise
Genus Power Infrastructure, a prominent player in the metering solutions sector, opened the day at ₹273.80 per share on the Bombay Stock Exchange (BSE). This initial price was just the beginning of a tremendous journey that culminated in a 5% upper circuit.
The company's wholly-owned subsidiary received two letters of awards, totaling ₹3,115.01 crore, for the appointment of Advanced Metering Infrastructure Service Providers (AMISPs).
These awards encompass a comprehensive range of responsibilities, from designing an Advanced Metering Infrastructure (AMI) system to the supply, installation, and commissioning of 34.79 lakh smart prepaid meters. The scope also includes system meters, including DT meters, and associated energy accounting on a Design Build Finance Own Operate Transfer (DBFOOT) basis.
Market Dominance Reinforced
The importance of this order win cannot be overstated. Genus Power's total order book now stands at an impressive ₹14,000 crore (net of taxes). This development not only speaks to their existing market dominance but also provides substantial visibility into future revenue growth.
Jitendra Kumar Agarwal, Joint Managing Director of Genus Power Infrastructures Ltd., expressed his pleasure at securing these substantial orders.
He emphasized that this achievement is a testament to their commitment to providing high-quality products and services, strengthening their market standing as the leading provider of intelligent metering solutions in India.
Market Analysis and Projections
Analysts in the field recognize the broader positive trend for Genus Power's stock. The 40-day Exponential Moving Average (DEMA) around 245 is considered crucial near-term support, which underlines the stock's strength.
Rajesh Bhosale, an Equity Technical and Derivative Analyst at Angel One, noted that the stock is in a strong uptrend. After a phase of sideways consolidation, it has resumed its primary uptrend by breaking the higher range. Bhosale predicts that in the near term, prices may extend their move towards ₹290, with ₹260 as immediate support.
They’re Building a Bright Future
Genus Power Infrastructures isn't resting on its laurels. Shortly after the ₹3,115 crore order, the company announced that its subsidiary received another smart meter order, this time worth ₹3,121.42 crore. This new order further solidifies their position as the primary provider of intelligent metering solutions in India.
The scope of this order includes designing an AMI system with supply, installation, and commissioning of 36.27 lakh smart prepaid meters and system meters. The project will be executed on a Design-Build-Finance-Own-Operate-
Transfer (DBFOOT) basis, and it pushes Genus Power's total order book beyond ₹17,000 crore.
Keeping an Eye on the Future
The Indian government's push to enhance the power distribution sector's operational efficiency and financial sustainability is a driving force behind these developments. The Revamped Distribution Sector Scheme aims to install 250 million smart meters across the country, and Genus Power is strategically positioned to benefit from this growing market demand.
In July, Genus Power Infrastructures partnered with GIC, Singapore, to establish a platform for funding smart metering projects in India. This partnership, with an initial capital outlay of $2 billion, reinforces Genus Power's commitment to providing innovative solutions in the Indian market.
Stock Movement on October 23, 2023
Here's a snapshot of Genus Power's stock movement on October 23, 2023:
|Stock Price (Open)||₹ 256.60|
|Stock Price (Close)||₹ 254.90|
|Day Range||₹245.25 - ₹267.60|
|52-Week Range||₹77.15 - ₹289.70|
|VWAP (Volume Weighted Avg. Price)||₹ 260.33|
|Upper Circuit Limit||₹ 267.60|
|Lower Circuit Limit||₹ 242.15|
|TTM EPS (Trailing Twelve Months Earnings Per Share)||1.56 (-11.86% YoY)|
|TTM PE (Trailing Twelve Months Price-to-Earnings Ratio)||162.15 (High PE)|
|P/B (Price-to-Book Ratio)||6.64 (High P/B)|
|Face Value||₹ 1|
|Market Capitalization||₹6,516 crore|
|20-Day Average Volume||5,18,037|
|Book Value Per Share||₹ 38.15|
Genus Power Infrastructure's stock movement reflects the significant developments and investor confidence in the company's future. As they continue to secure substantial orders and expand their presence in the smart metering sector, the company is poised for a bright and promising future in the Indian market.
- Genus Power Infrastructures Limited got orders worth INR 4,400 crores in Q1 FY24, with a total order book of INR 8,200 crores.
- They plan to finish these orders in the next 24 to 27 months, which is good for their growth in FY24-25.
- State Electricity Boards (SEBs) are inviting more orders, so they expect more business this year.
Partnerships and Agreements
- The company teamed up with Gem View Investment to make smart meters and related services.
- They also secured a loan commitment from the United States International Development Finance Corporation to expand electric smart meters in India.
- In Q1 FY24, their sales were INR 261 crores, up 39.6% from Q1 FY23.
- Their earnings before interest, taxes, depreciation, and amortization (EBITDA) were INR 29 crores, up 99.7% from Q1 FY23.
- Their profit after tax (PAT) for Q1 FY24 was INR 19 crores.
- They expect around INR 1,200 crores in total revenue this year.
There have been some issues with getting electronic components like semiconductors, but things are getting better. However, it still affects their revenue due to not using all their capacity.
The Indian metering industry should keep getting lots of orders, more money, better profit margins, and faster money circulation.
They believe their business will get a lot better starting from Q3 FY24 onwards."
DisclaimerInvestment/Trading in securities Market is subject to market risk, past performance is not a guarantee of future performance. The risk of loss in trading and investment in Securities markets including Equites and Derivatives can be substantial.
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