Stock To Buy: HSBC Global initiates coverage on Multibagger Engineering Stock, TP Rs 730

HSBC Global has initiated coverage on small cap engineering sector stock, Titagarh Rail Systems Ltd and assigned buy call with target price of Rs 730 apiece. It implies that if investors buy Titagarh Rail Systems shares at current market price of Rs 604.80 per share (as of July 20, 2023), they can fetch potential gain of 21%. Titagarh Rail Systems stock witnessed a rally of over 9% intraday yesterday (July 19) soon after HSBC Global recommended investors to buy the share. Check details below:

Titagarh Rail Systems Stock Performance & Return: Current market price of Titagarh Rail Systems share is Rs 604.80 at 9:10 am. Titagarh Rail Systems shares hit new 52-week high today. It also traded new 52-week high on July 19 and July 17.

The stock's 52-week high price is Rs 607.95 per share and 52-week low price is Rs 120.25 per share, respectively. It has a market capitalisation of Rs 7457.05 crore. In last 6-months, Titagarh Rail Systems shares jumped 181%, soared 384% in last 1-year, gave return of 774% in last 2-years, and a huge return of 1381% in last 3-years.

Valuation: HSBC Global said in its brokerage report that the Indian government's plan to add more freight on its rails offer robust opportunity for Titagarh Rail Systems.
According to the HDBC Global, Titagarh Rail Systems Earnings per Share (EPS) to register more than double growth in the next three years with Return on Equity likely to be in the high teens. Indian Railways plan to raise the share of freight traffic by rail to 45% by 2030 from current 27%, according to a Railway Ministry report.
HSBC Global sees Titagarh's net profit soaring by 2.5 times between FY 2023-23, with an average RoE of 18% along with more diversified business.

Orders Received Last Month: Earlier this year on June 27, 2023 the company received Letter of Acceptance (LOA) from Gujrat Metro Rail Corporation (GMRC) Limited w.r.t " Design , Manufacture, Supply, Testing, Commissioning and Training of 72 nos. of Standard Gauge Cars for Surat Metro Rail Phase-I Project I". The order value is about INR 857 crore and execution would start 76 weeks after signing the contract and is scheduled to be completed in 132 weeks thereafter.

The company also informed BSE on June 15, 2023, "We enclose herewith a Press Release titled "Ramkrishna Forgings Limited and Titagarh Rail Systems Limited consortium wins contract to supply 1.54 million forged wheels under AatmaNirbhar Bharat Initiative by Ministry of Railways as a boost to Make in India" which is self-explanatory."

Titagarh Rail Systems Financial Performance: The company for the quarter ended March 31, 2023 declared its consolidated total income at Rs 981.20 crore, up 26.19% from last quarter total income of Rs 777.56 crore. It announced its recent quarter net profit after tax at Rs 51.94 crore.

Disclaimer:The stock has been picked from the brokerage report of HSBC Global. 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.