This industrial stock was trending today!

This industrial stock was trending today!

Indian Market
by 5paisa Research Team Last Updated: 2022-12-12T17:24:43+05:30

The stock surged 4% on Monday.

On December 12, the market closed flat. The S&P BSE Sensex closed trading at 62,130.5, down 0.08%, while NIFTY50 closed at 18,497.15, up 0.003%. Regarding sectoral performance, Oil & Gas was the top gainer, while Consumer Durables and IT were among the top losers. Talking about stock-specific action, Pitti Engineering Ltd was among the top gainers in BSE group ‘A’.

The shares of Pitti Engineering Ltd surged 4% and closed trading at Rs 331.8. The stock opened at Rs 313.55 and made an intraday high and low of Rs 334.25 and Rs 313.55, respectively.

Pitti Engineering Ltd is engaged in the manufacturing of electrical steel laminations, motor cores, sub-assemblies, die-cast rotors, press tools and machining of metal components. It has two manufacturing plants, one in Hyderabad and the other in Aurangabad. For the latest September 2022 quarter, exports contributed about 37% to the total revenue, while 63% came from domestic business.

Wabtec Corporation, General Electric, Siemens Limited, ABB India Limited and Cummins India Limited are among the company’s key clientele. Due to specialised product offerings to these customers, the company enjoys repeat orders and long-term revenue stability.

The company incurred capex of around Rs 50 crore during 1QFY23 to increase its production capacity to 50,200MT from 46,000 MT at its Aurangabad facility. For remaining of FY23, the company has planned Rs 50 crore capex to further enhance this capacity to 72,000MT. The management has also shared their ongoing discussion about the Rs 197 crore capex plan between FY24 and FY25.

About the shareholding pattern, as per September quarterly filings, the promoters have 59.29% ownership in the company, non-institutional investors hold 37.77 per cent, DII hold 2.9 per cent, and the rest 0.05% is held by FIIs.

The company is adding new capacity to catch up with increasing demand, especially from railways. They are focusing on improving their product mix, and shortening their working capital cycle, and hence, combining all these factors, the future looks bright for the company.

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