Engineering Sector Stock Gets Buy Rating After Strong Q3 Performance: Sharekhan

Sharekhan has recommended investors to buy mid cap Engineering sector stock, Thermax Ltd with a target price of Rs 2790 apiece. Current market price of the stock is Rs 2161.15 apiece with intraday dip of 0.87%. If you buy Thermax Ltd share now, you can get potential return of 29%. Check details below:

Thermax Ltd Stock Performance & Return: Last trading price of Thermax is Rs 2161.15 apiece. Its 52-week high price is Rs 2678.50 apiece and 52-week low price is Rs 1830.35 apiece, respectively. Its market capitalisation is Rs 25,751.46 crore. The stock gave a return of 13% in last 1-year and 158% return in last 3-years.

Thermax Ltd Valuation: According to Sharekhan, "Nevertheless, in the long term, Thermax with its strong execution and technological capabilities in green energy and the wastewater industry should be able to deliver strong performance. Further, robust financials in terms of healthy cash balance and balance sheet give us confidence. Hence, we reiterate our Buy rating on the stock with an unchanged price target (PT) of Rs. 2,790, valuing the stock on its September 2024E EPS."

Key positives: Order book remained strong at Rs. 9,859 crore (up 33% y-o-y). The company reported healthy revenue growth in the energy and environment segments. Margin in both environment and chemical segments improved on a y-o-y and q-o-q basis.

Key negatives: Order intake was down 10% y-o-y due to the absence of any large order. The inquiry pipeline has moderated, particularly for large orders (in the refinery, petrochemicals, and steel sectors) compared with last year.

Thermax Ltd About: Thermax provides solutions in the energy and environment space. The energy business contributes 73% to the revenue, whereas the environment business contributes 21% and the chemical business contributes 9%. The company operates globally through 33 international offices and 13 manufacturing facilities, seven of which are in India and six are overseas.

Disclaimer: The stock has been picked from the brokerage report of Sharekhan. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.