The shares of this leading defence OEM manufacturer plunged by 11 percent on Friday after it sold an equity stake worth 7.4 percent via a block deal. In this article, we will look into the details of the deal.
With a market capitalization of Rs 10,441 crore, the shares of Azad Engineering Ltd are currently trading at Rs 1,617 per share, down by 22.3 percent from its 52-week high of Rs 2080 per share. Over the last six months, the stock has delivered a negative return of 8.28 percent.
About the deal
According to sources, as many as 48 lakh shares exchanged hands worth Rs 780 crore on Friday, representing a 7.4 percent stake in the engineering company. The transaction is executed at a price of Rs 1,640 per share, which is a discount of 6.44 percent from its previous day closing price of Rs 1,752.90, following a block deal.
On February 5, Azad Engineering signed a long-term contract with Rolls-Royce to manufacture complex machined parts in India throughout the lifecycle of the engine program.
Azad Engineering Limited is engaged in designing and producing precision-engineered aerospace, defence, energy, and oil & gas industry components in India and worldwide. The company offers turbine blades, nozzles, impellers, actuators, and fluid distribution components for aircraft engines, missile systems, and power turbines. It also offers intricate components for nuclear and thermal power solutions, as well as critical subsystems for midstream and upstream oil & gas operations.
The company reported a revenue of Rs 457 crore in FY25, up by 34 percent from its FY24 revenue of Rs 341 crores. Additionally, it reported a net profit growth of 47.45 percent to Rs 87 crore in FY25 from Rs 59 crores in FY24.
The stock delivered an ROE and ROCE of 8.49 percent and 12.17 percent respectively, and is currently trading at a P/E of 120.51x as compared to its industry peers of 52.80x.
Written by Satyajeet Mukherjee
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