ISGEC Heavy Engg jumps 8% to 52-week high on strong sales, margin expansion

ISGEC Heavy Engineering shares jumped 8 percent on May 29 after strong sales and profitability lifted investor sentiment for the stock.

At 9:34am, the stock was quoting at Rs 576.50, up 7.10 percent. The stock was trading with volumes of 25,524 shares so far today as compared with its five-day average of 18,588 shares, an increase of 37 percent. The scrip hit its 52-week high at Rs 587.95 today.

Market capitalisation of the company stands at Rs 4,238.98 crore.

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Consolidated revenue surged 28 percent on-year during the quarter ended March at Rs 2,042.7 crore, supported by an on-year rise in sales from three segments of manufacturing of machinery and equipment, engineering, procurement and construction, and ethanol (plant under construction) at the Phillippines.

The company’s quarterly net profit soared 138 percent YoY to Rs 93.16 crore. Following a decline in finance and raw material costs, the company’s EBITDA margin expanded to 8.04 percent from 6.67 percent a year ago.

With a gradual improvement in order inflow and margin led by better job mix, analysts had said after last quarter’s earnings that they expect execution to pick up along with gradual improvement in profitability. The company had also pointed out that it expects to grow manufacturing business by 15 percent in FY24, which may lead to further improvement in margin.