Triveni Turbine shares jump 32% in 6 sessions as post-earnings rally continues

Despite the broader market's downturn, Triveni Turbine shares soared 20% during today's intraday session, hitting a record high of ₹838 per share, before ending the session with a gain of 12.33% at ₹787 apiece. This surge reflects continued investor enthusiasm following the company's strong June quarter results, released on August 06, which surpassed analyst expectations across all parameters. Today's rally has brought the stock's gains over the past six days to 32%.

The company reported a 23.1% year-on-year increase in consolidated revenue, reaching ₹4.6 billion. Product revenue rose by 24.2% year-on-year to ₹3.1 billion, while aftermarket revenue grew by 21.1% year-on-year to ₹1.6 billion.

The EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) climbed 34.8% year-on-year to ₹956 million, with the EBITDA margin improving by 180 basis points to 20.6%. Its net profit after tax (PAT) increased by 31.7% year-on-year to ₹800 million, exceeding the projected ₹770 million, thanks to strong operating performance and a 45.2% rise in other income to ₹194 million.

For Q1 FY25, Triveni Turbine reported order inflows of ₹6.4 billion, marking a 40.4% year-on-year increase. Export orders surged by 74.1% year-on-year to ₹4.2 billion, largely driven by substantial orders from the oil and gas industry in the Middle East.

Analysts note that the outlook for exports remains robust across key regions, including Europe, Southeast Asia, the Middle East, and the US, covering both products (industrial and API turbines) and aftermarket services (refurbishment, spares, and maintenance). The company’s order book stands at ₹17.3 billion.

Although domestic order intake was affected by the general elections, the company noted a 14% year-on-year increase in the enquiry pipeline. Order finalisation is expected to accelerate in the upcoming quarters, driven by sectors such as steel, cement, distillery, renewable energy investments, and waste-to-energy projects.

There is also significant order visibility in the larger MW segment, providing revenue visibility for FY25 and FY26, the company said.

Business developments

The company's research and development efforts have led to the introduction of turbines ranging from 110 to 120 MW, which are gaining traction among steel plants and oil and gas facilities. These turbines cater to industrial applications requiring high-process steam.

Additionally, Triveni Turbine has invested ₹200 million year-to-date in its US subsidiary. This investment has led to improved enquiry generation in the US, primarily due to greenfield and brownfield expansions and some replacement demand. The company plans to continue focusing on its aftermarket business, given the robust market for refurbishment, spares, and services.

Target prices left behind

Following the release of the company's June quarter results, domestic brokerage firm Prabhudas Lilladher has upgraded its rating on Triveni Turbine to 'buy' and raised its target price to ₹719 per share.

The brokerage maintains that Triveni Turbine's prospects remain strong due to several factors: a healthy enquiry pipeline across markets, an increasing share of higher-margin exports and aftermarket sales, robust demand for both industrial and API-driven turbines, and a solid order book with strong inflows across various business segments.

Similarly, Motilal Oswal has also retained its 'buy' rating on the stock, with a target price of ₹720 per share. However, the stock has already surpassed both brokerage firms' target prices.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.