Azad Engineering shares surged 14% amid market sell-off. Here's why

Shares of Azad Engineering surged more than 14 per cent during the trading session on Monday after the company announced an order win from Mitsubishi, a global conglomerate. The company informed about the same through an exchange filing with the bourses over the weekend.

Azad Engineering has signed long term contract and price agreement (LTCPA) with Mitsubishi Heavy Industries, Japan (MHI) for supply of highly engineered & complex rotating and stationary airfoils for advanced gas & thermal power turbine engines to meet their global demand in the power generation industry, said the company in an exchange filing dated November 3.

"This current Phase of contract is valued at $82.89 million or Rs 700 crore is a robust step towards cementing our everlasting strategic relationship with Mitsubishi Heavy Industries Limited, Japan (MHI)," said the company in its exchange filing. This international contract has a tenure of 5 years for execution, it added.

Following the announcement, shares of Azad Engineering Ltd zoomed 14.30 per cent to Rs 1670.25 on Monday, with its total market capitalization nearing Rs 10,000 crore mark. The stock had settled at Rs 1,461.10 in the previous trading session on Friday.

Incorporated in 1983, Azad Engineering is a manufacturer of aerospace components and turbines. The company supplies its products to original equipment manufacturers (OEMs) in the aerospace, defense, energy, and oil and gas industries. Its products are highly engineered, complex, mission-critical, and vital.

Shares of Azad Engineering were listed at the bourses in December 2023, when the Hyderabad-based company raised Rs 740 crore via IPO by selling its shares for Rs 524 apiece. The stock has zoomed nearly 220 per cent from its IPO price but has corrected about 20 per cent from its 52-week high at Rs 2,080 hit in June this year.