Sachin Tendulkar-backed Azad Engineering stock up 3% amid report ADIA buys 3.98 lakh shares

Shares of Sachin Tendulkar-backed Azad Engineering Ltd advanced 3 per cent in Friday's trade amid a media report suggesting Abu Dhabi Investment Authority (ADIA), a sovereign wealth fund, bought 3.98 lakh equity shares, or 0.67 per cent of paid-up equity, in the newly-debuted company on Thursday. As per the Moneycontrol report, the high-precision forged and machined component maker bought equity shares at an average price of Rs 719.90 per share, aggregating to Rs 28.65 crore.

Following the report, the stock rose 3.08 per cent to hit a high of Rs 698 on BSE. To recalll, Abu Dhabi Investment Authority-Monsoon was among anchor investors in the Azad Engineering IPO and was allocated 4,67,572 shares or 11.10 per cent of the anchor investor portion at Rs 524 apiece.

The Azad Engineering stock had hit a high of Rs 727.50 on its debut on Thursday. The stock eventually closed the previous session at Rs 677.50 , up 29.29 per cent over its issue price of Rs 524. This was lower than the Street expectations.

Mehta Equities said Azad Engineering's product profile creates a high entry barrier that requires a long and rigorous approval process for any competitor.

"In the long run, we see a lot of growth opportunities come through expansion plans and gaining market share globally from 1 epr cent to multifold due to larger wallet share contributions from long standing clientele like Mitsubishi Heavy, General Electric, Honeywell International, Siemens Energy and many more," the domestic brokerage said.

Azad Engineering, Mehta Equities said, is in the right space and product profile to tap the government's focus under Make in India. "The trust Azad has built in its 15 years of business operations would help the company to grow healthy in coming years," it said.