Recommendations from Power - Transmission & Equipment and Sugar 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.

TRANSFORMERS AND RECTIFIERS (INDIA) LTD

CMP - ₹61.95
BSE CODE 532928
Face Value ₹2
Target ₹68-73
Stoploss ₹57 (CLS)

Transformers and Rectifiers (India) Ltd. is a manufacturer of power, furnace and rectifier transformers. Recently, the company released a positive set of consolidated numbers in Q2FY23 wherein the revenue from operations rose 15 per cent to ₹307.46 crore against the previous quarter last year. EBITDA levels stood at ₹35.99 crore, up 58 per cent from last year’s quarter. The net profit zoomed 121 per cent to ₹12.23 crore from the corresponding quarter last year. The company, in its recent filings, stated that it received two orders of transformers worth ₹145 crore from well-known Indian companies. With this order, the company’s order book as of October 31 stands at ₹1,476 crore. During the quarter, the company received an order inflow of ₹331 crore. The company has currently participated in the bidding process of state utilities, central utilities, EPCs, private, TBCB tenders, etc. for more than ₹9,000 crore. Hence, we recommend BUY

TRIVENI ENGINEERING & INDUSTRIES LTD

CMP - ₹299.15
BSE CODE 532356
olume 2,33,971
Face Value ₹2
Target ₹333-345
Stoploss ₹270 (CLS)
 

One of the largest integrated sugar manufacturers in the country, Triveni Engineering and Industries (TEIL) also ranks among the leading companies in the engineering sector, which includes power transmission and water and waste water treatment solutions. Taking into account the company’s financial performance, on a consolidated basis it reported growth of 27.41 per cent from ₹1,155.02 crore registered in Q2FY22, recording total revenue of ₹1,471.62 crore in Q2FY23. Comparing the net profit for the second quarter of FY23 to the same quarter last year, it skyrocketed 2,431.28 per cent from ₹54.51 crore to ₹1,379.80 crore. Promoters owned 68.26 per cent share in the company, of which Indian promoters controlled 52.82 per cent. The company’s shares have seen a significant rise over last month and have room to soar even higher. Along with the significant promoter ownership, the company’s positive aspects include dividend declaration, low PE and a high RoE. Hence, we recommend BUY. 

(Closing price as of Nov., 28, 2022)