The share of this smallcap company jumps 4 percent in Wednesday’s trading session after receiving a letter of award to supply transformers worth Rs. 42.56 crores. The stock has delivered more than 100 percent return to its shareholders in just six months.
Price Movement:
With a market capitalization of Rs. 2,139 crores, the shares of Indo Tech Transformers Ltd started Wednesday’s trading session on a higher note at Rs. 2,030 compared to its previous close of Rs. 1,983.35.
During the session, the shares hit a high of Rs. 2,080, gaining around 4 percent and are currently trading at Rs. 2,004 apeice.
What Happened:
Such a bullish movement in the share price was observed after the company in an exchange filing announced that it had received a Letter of Award (LoA) from a domestic entity for supplying four 192 MVA transformers. The total value of this order amounts to Rs. 42.56 crores.
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Financials:
Looking at the company’s financial statements, the revenue decreased by around 53 percent from Rs. 174.71 crores during the March quarter to Rs. 82.15 crores in the June quarter. On the other hand, the net profits declined by 77 percent from Rs. 25.57 crores to Rs. 5.91 crores during the same timeframe.
Important Financial Ratios:
In terms of key financial metrics, the company reported a return on equity of 21.57 percent and a return on capital employed of 27.30 percent for the period spanning FY23-24. Additionally, the net profit margin stood at 9.30 percent during the same timeframe.
Industry Context:
The transformer industry is experiencing a surge in demand, particularly driven by sectors such as renewables and industrial expansions. Indo Tech Transformers is strategically positioned to capitalize on this trend, enhancing its market share while maintaining healthy margins.
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Customer Base:
Indo Tech Transformers serves a diverse clientele across various sectors, including transmission, generation, hydro, wind, solar energy, steel, cement, and textiles. Notable clients include TNEB (Tamil Nadu Electricity Board), NTPC (National Thermal Power Corporation), and several multinational corporations
Shareholding Pattern:
According to the latest shareholding pattern, Promoters own 75 percent of the shares, foreign institutional investors (FIIs) hold 0.42 percent, domestic institutional investors (DIIs) possess 0.01 percent, and the remaining 24.58 percent is held by the public.
Company Profile:
Indo Tech Transformers Ltd. is engaged in the business of manufacturing power and distribution transformers and various special application transformers, mobile substation transformers and substations.
Written By Vaibhav Patil
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