Recommendation from Compressors / Pumps and Logistics Sector

The scrips in this column have been recommended with a 15-day investment horizon in mind and carry high risk. Therefore, investors are advised to take into account their risk appetite before investing, as fundamentals may or may not back the recommendations.

INGERSOLL-RAND (INDIA) LTD.
CMP - ₹2,441.55
BSE CODE 500210
Volume 1,998
Face Value ₹10
Target ₹2,550 - 2,600
Stoploss ₹2,430 (CLS)

Ingersoll Rand India Limited is engaged in the business of manufacturing and selling industrial air compressors and offers related services such as installation, commissioning and maintenance. The company’s brands include NASH, Comp Air, Ingersoll Rand, Gardner Denver, etc. For the quarter ended December 31, 2022, the company’s total income rose by more than 30 per cent from the December 2021 quarter to ₹323.85 crore. The net profitability of the company posted a spike of more than 67 per cent from the corresponding quarter last year to ₹47.96 crore. Recently, the company’s Board of Directors approved setting up a new manufacturing plant to be situated in Gujarat to increase the manufacturing capacity of the existing products and also to manufacture new products. The investment required is expected to be around ₹170 crore and the rationale for this plant is to fuel future growth prospects while also securing space for immediate expansion plans. Given th future growth potential and the management strategies, we recommend BUY.

AEGIS LOGISTICS LTD.
CMP - ₹376.90
BSE CODE 500003
Volume 11,444
Face Value ₹1
Target ₹410 - 422
Stoploss ₹365 (CLS)

Aegis Group, founded in 1956, is a major player in India’s oil and gas industry with its flagship company, Aegis Logistics Ltd., being the country’s leading integrated oil, gas and chemical logistics company. The company has distinct business segments including liquid logistics, gas logistics, engineering, procurement and construction services, retail LPG, etc. Considering the company’s financial performance, on a consolidated basis it reported a significant growth of 71.88 per cent from ₹1,214.10 crore registered in Q3FY22, recording total revenue of ₹2,086.74 crore in Q3FY23. When comparing the net profit for the third quarter of FY23 to the same quarter last year, it climbed by 23.16 per cent from ₹101.77 crore to ₹125.34 crore. With 18-20 per cent return on equity and capital employed, the company displays strong profitability. Its shares have surged more than 11 per cent over the past month and have returned more than 88 per cent in the last year. The stock can be viewed as a dividend investment as it declares dividends every financial quarter. Hence, we recommend BUY