Synopsis:
Venus Pipes & Tubes is in focus as Nuvama Institutional Equities expects the stock price to rise by a staggering 67 percent, citing revised FY26 guidance to 25 percent from 20 percent, backed by a solid order book and value unlocking as it rapidly expands its footprint along the export front.
The shares of this leading manufacturer and exporter of stainless steel pipes and tubes in India are in focus after bagging a notable upside from Nuvama. In this article, we will try to understand the rationale behind this uptick.
With a market capitalization of Rs 2,767 crore, the shares of Venus Pipes & Tubes Ltd are currently trading at Rs 1,350 per share, representing a decline of 43 percent from its 52-week high of Rs 2,380 per share. In the last six months, the stock has declined by 5 percent.
Analyst Comments
Leading brokerage firm Nuvama Institutional Equities has set a target price of Rs 2,260 per share, signaling an upside potential of 67 percent from its previous day’s closing price of Rs 1,351.60 per share.
The brokerage has pointed out that Venus Pipes has raised its revenue growth forecast for FY26 to 25 percent, up from the previous 20 percent. This change reflects a growing confidence in the company’s ability to successfully implement its plans.
Their optimism is backed by a robust order book totaling Rs 560 crore, which features a notable Rs 190 crore order from a prominent Indian power equipment manufacturer, highlighting strong demand from both domestic and industrial sectors.
On top of that, the company is experiencing a surge in export activity, with shipments increasing by about 70 percent year-on-year in Q1FY26, signaling a growing presence in international markets.
The blended capacity utilization is projected to be around 80 percent this year, indicating that the current production facilities are being utilized effectively. Furthermore, new seamless and condenser tube capacities set to come online in H2 FY26 are expected to further boost revenue growth, paving the way for volume expansion.
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Financial Highlights
The company reported a revenue of Rs 276 crore in Q1 FY26, up by 15 percent from its Q1 FY25 revenue of Rs 240 crore. Additionally, revenue grew by 7 percent from Rs 258 crore in its previous quarter.
Regarding its profitability, the company reported a net profit of Rs 25 crore in Q1 FY26, down by 11 percent from its Q1 FY25 net profit of Rs 28 crore. Additionally, net profit grew by 4 percent from Rs 24 crore in its previous quarter.
The stock delivered an ROE and ROCE of 19.81 percent and 25.55 percent respectively, and is currently trading at a high P/E of 30.92x as compared to its industry average of 24.17x.
In summary, the brokerage is confident that Venus Pipes has a solid outlook on orders, production, and exports, which supports its belief in achieving significant growth in the upcoming year.
Venus Pipes and Tubes Limited is a worldwide leader in manufacturing stainless steel pipes and tubes, offering a range that includes seamless, welded, and high-precision options. The company caters to various industries such as power, chemicals, pharmaceuticals, oil and gas, food processing, defense, and aerospace. They distribute their products through direct supply channels, stockists, and traders.
Written by Satyajeet Mukherjee
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