Synopsis:
Lokesh Machines surged sharply to hit it upper circuit as it got a registration certificate from the Director General of Quality Assurance (DGQA) that allows it to start domestic defence operations.
The shares of this leading defence company is in focus after it announced a key update that has the potential to expand its business to a significant extent. In this article, we will dive more into the details.
With a market capitalization of Rs 432 crore, the shares of Lokesh Machines Ltd made a day high of Rs 223.50 per share, up by 10 percent (Upper Circuit) from its previous day closing price of Rs 203.20 per share. Over the past five years, the stock has delivered a robust return of 864 percent.
Reason Behind this Rally
Lokesh Machines Limited announced that it has received a Registration Certificate from the Director General of Quality Assurance (DGQA) under the Ministry of Defence, Government of India.
This certification allows the company to start manufacturing defence-related products right at its facilities. The license is valid until August 19, 2030, and it will help the company broaden its product range.
This approval means that Lokesh Machines can now officially produce defence equipment for the government and the defence sector. It paves the way for new business opportunities, broadens their product range, and has the potential to boost revenue growth in the future, especially since the defense sector is known for its high demand and value.
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Financial Highlights
The company’s revenue for Q1 FY26 was Rs 48.05 crore, representing a 23 percent decrease from Rs 62.53 crore in the same quarter last year. However, on a sequential basis, revenue surged by 24 percent from Rs 38.69 crore in Q4 FY25.
Regarding its profitability, the company reported a 55 percent net profit decline to Rs 46 lakh in Q1 FY26, compared to Rs 1.03 crore in Q1 FY25. However, on a QoQ basis, it surged by 254 percent from Rs 13 lakh. The stock delivered a poor ROE and ROCE of 0.26 percent and 4.87 percent respectively.
Lokesh Machines Limited is an Indian company that specializes in manufacturing and selling machine tools. Their product lineup features CNC machines, custom machines, automation solutions, and auto components like cylinder blocks, heads, and connecting rods.
They also export their products to various countries, including Japan, Germany, Italy, and China, among others. With a strong emphasis on innovation and automation, the company serves both domestic and international markets, supporting industries such as automotive, aerospace, and defense.
Written by Satyajeet Mukherjee
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