scorecardresearchTitagarh Rail Systems stock jumps 4.4% after company signs contract worth

Titagarh Rail Systems stock jumps 4.4% after company signs contract worth 857 crore

Updated: 04 Oct 2023, 11:40 AM IST
TL;DR.

Titagarh Rail Systems is the largest private-sector manufacturer of railway wagons and an established player in passenger coaches. The shares have delivered remarkable performance in CY23 so far, generating a return of 247%, soaring from 227 apiece to trade at the current level of 788.

The stock has risen 3753% to date from its March 2020 low of  <span class='webrupee'>₹</span>20.45 apiece.

The stock has risen 3753% to date from its March 2020 low of 20.45 apiece.

Titagarh Rail Systems (formerly Titagarh Wagons) witnessed a 4.40% surge in its share price to reach 803.90 during early trade on Wednesday, following the company's announcement of a contract agreement with Gujarat Metro Rail Corporation Limited.

The contract is for the design, manufacture, supply, testing, commissioning, and training of 72 standard gauge cars for the Surat Metro Rail Phase I Project. The company said the execution of the contract will commence in 76 weeks after the signing of the contract and it is expected to be completed in 132 weeks thereafter. The order value of this project is 857 crore, according to company's exchange filing. 

The company has already secured a letter of acceptance (LoA) for 30 standard gauge cars for Phase II of the Ahmedabad Metro Rail Project, with an order value of approximately 350 crore.

The Surat Metro Rail Project encompasses two corridors spanning a total of 40.45 kilometers with 38 stations and an estimated cost of 12,020 crore.

Titagarh Rail Systems is the largest private-sector manufacturer of railway wagons and an established player in passenger coaches. The company has been awarded the largest-ever order for wagons by Indian Railways in addition to the orders for the manufacture and supply of metro trains for the Pune Metro and Surat Metro projects.

Earlier in June, the Titagarh-BHEL consortium bagged a contract for the manufacturing and maintenance of 80 Vande Bharat trainsets, including the up-gradation of the Government Manufacturing Units & Trainset Depot. The contract value is close to 24,000 crore for the manufacture of 80 train sets and maintaining them for the next 35 years.

Also, the consortium of Ramkrishna Forgings and Titagarh Rail Systems secured a contract for the manufacturing and supply of forged wheels under Aatma-Nirbhar Bharat by the Ministry of Railways, Government of India.  The value of the order book is about 13,000 crore.

The shares have delivered remarkable performance in CY23 so far, generating a return of 247%, soaring from 227 apiece to trade at the current level of 788. This stellar performance was attributed to the company's robust financial numbers for FY23 and strong order inflows with ongoing transformation in the railway sector. In addition, the stock has risen 3753% to date from its March 2020 low of 20.45 apiece.

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Stock price chart of Titagarh Rail Systems

For the June-ending quarter, the company reported a 110% YoY improvement in revenues to 911 crore and a 158% YoY surge in EBITDA to 106 crore. It reported a 194% jump in consolidated profit after tax at 62 crore.

At of the end of the June quarter, the company's order book stood at 27,890 crore, strategically diversified across various segments. Notably, the company has secured wagon orders valued at approximately 443 crore from the private sector in Q1FY24, further diversifying the wagon order book and accounting for 20% of the overall FTRS order book, as per the company's earnings report.

06 analysts polled by MintGenie on average have a 'strong buy' call on the stock.

Disclaimer: We advise investors to check with certified experts before taking any investment decisions.

 

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First Published: 04 Oct 2023, 11:40 AM IST