Rs 63 to Rs 393: This stock turned into a multibagger in three years; Q1 earnings beat estimates

Shares of multibagger Triveni Turbine Ltd have delivered over 500% percent returns to investors in the last three years. The power equipment stock, which closed at Rs 62.75 on July 31, 2020 ended at Rs 393.45 in the previous session (August 1, 2023), clocking 529% returns during the period. In comparison, Sensex has risen 76.88% in three years. Triveni Turbine stock closed 1.20% lower at Rs 395 in the previous session. Earlier, the stock opened higher at Rs 402.40 against the previous close of Rs 399.80 on BSE. The share belonging to power sector has gained 58% this year and risen 119% in a year.

Total 0.45 lakh shares of the firm changed hands amounting to a turnover of Rs 1.77 crore in j Tuesday . Market cap of the firm fell to Rs 12,556 crore. The stock hit a 52-week low of Rs 167 on August 1, 2022 and a 52-week high of Rs 430 on June 19, 2023.

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In terms of technicals, the relative strength index (RSI) of the stock stands at 50, signaling it's trading neither in the overbought and nor in the oversold zone. Triveni Turbine shares have a beta of 0.8, indicating very low volatility in a year. Triveni Turbine shares are trading higher than the 100 day, 150 day and 200 day but lower than the 5 day, 10 day, 20 day, 30 day  and 50 day moving averages.

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Seven promoters held 55.84 per cent stake in the firm and 82,721 public shareholders owned 44.16 per cent or 14.03 crore shares for the quarter ended June 2023. Of these, 79,802  resident individuals held 1.27 crore shares or 4% stake with capital up to Rs 2 lakh.

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In the June quarter of this fiscal, Triveni Turbine posted a 58.81% rise in net profit to Rs 60.75 crore against Rs 38.25 crore profit during the quarter ended June 2022. Sales rose 46.26% to Rs 389.77 crore in Q1 against Rs 266.49 crore during the quarter ended June 2022.

EPS rose to Rs 1.91 in the June 2023 quarter against Rs 1.18 in the corresponding quarter of the previous fiscal.

Amit Anwani – Research Analyst at Prabhudas Lilladher  said, “Triveni Turbine earnings were a beat on the topline front while EBITDA margins impacted owing to higher other expenses. Consolidated sales came in better than estimates at Rs 380 crore, up 56.3% YoY (Prabhudas Lilladher estimate of Rs 330 crore and consensus estimate of Rs 340 crore), driven by strong execution. Gross margin expanded 840 bps YoY to 51.5% in Q1FY24. EBITDA grew 45.6% YoY to Rs709 mn (Prabhudas Lilladher estimate of Rs 63.3 crore and consensus estimate of Rs 66.8 crore).  Despite strong gross margin expansion, EBITDA margins remained flat YoY 18.8% in Q1FY24 (vs Prabhudas Lilladher estimate of 19%), due to higher other expenses (up 143% YoY). Other expenses were higher as during the quarter it included subcontracting charges (Rs391.4mn) towards execution of maintenance and overhauling contract for large utility turbines in South African Development Community (SADC) region by its subsidiary.”

About the company     

Triveni Turbine Limited is an industrial steam turbine manufacturer. The company is primarily engaged in the business of manufacturing and supplying power generating equipment and solutions and has manufacturing facilities in Bengaluru, Karnataka. Approximately 6,000 steam turbines supplied by the company are installed across 20 industries in over 75 countries, including Europe, Africa, Central and Latin America, Southeast Asian and South Asian Association for Regional Cooperation countries.

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