77% upside potential? This multibagger Vijay Kedia stock gets thumbs up despite weak Q3

Domestic brokerage firms continue to remain positive on a multibagger stock, which is also a part of Vijay Kedia's portfolio. The company announced its quarterly results last week, missing the estimates but the analysts tracking it see a strong upside in it. Their target prices suggest an upside potential of 77 per cent in the stock.

We are talking about Elecon Engineering Company Ltd, a stock which dropped another 7 per cent on Monday. The stock has crumbled more than 23 per cent from its level around Rs 513.9 on Thursday, January. The total market capitalization of the company has slipped below Rs 8,900 crore.

Elecon Engineering's net profit dropped 33 per cent on a year-on-year (YoY) basis to Rs 72 crore compared to the December 2025 quarter, while revenue for the quarter rose 4.3 per cent YoY to Rs 551.7 crore. Ebitda for the declined 23.2 per cent YoY to Rs 109.2 crore, while margins crashed nearly 710 basis points to 19.8 per cent for the third quarter.

Elecon's numbers were miss on revenue, Ebitda and profit front and it has also revised its estimates downwards, said Axis Securities. Management has revised its FY26 revenue guidance downward by up to 5 per cent from the earlier guidance of Rs 2,650 crore. Adjusted margins are expected to be lower by up to 2 per cent compared to the earlier guidance of 24 per cent, it said.

Despite the near-term moderation, improvement is anticipated, supported by a strong order book and a robust enquiry pipeline. Growth is expected to be driven by seasonal demand and sustained traction in key end user industries, particularly cement, steel, sugar, and power. It expects to maintain this growth momentum and continues to progress toward its strategic objective," it added with a 'buy' rating and a target price of Rs 635.

Shares of Elecon Engineering have tumbled nearly 45 per cent from its 52-week high at Rs 716.55, hit in June 2025. The stock is down 25 per cent in the last one year. Despite this correction, the stock has zoomed nearly 1,650 per cent in the last five years, while it is up 4,000 per cent from its Covid-19 lows.

Emkay Global maintains 'buy' on Elecon Engineering, while revising down target price estimate by 7 per cent to Rs 700 from Rs 750. The revision follows a weak Q3FY26 performance and the management lowering its FY26 revenue/Ebitda margin guidance. The management highlighted the robust enquiry pipeline across key end-user industries, it said, suggesting a 77 per cent potential in the stock from day's low.

"Ebitda margins compressed sharply, impacted by an unfavorable product mix and higher employee costs following the implementation of new labor codes. On a positive, the past eight-quarter order inflow average stands at Rs 600 crore, which translates into a healthy order backlog of Rs 1,370 crore; this provides strong medium-term revenue visibility," Emkay adds.

Seasoned Dalal Street investor Vijay Kishanlal Kedia owned 22,50,000 equity shares, or 1 per cent, stake in Elecon Engineering Company as of December 31, 2025, keeping his stake unchanged in the company. His stake in the company is valued currently close to Rs 92.5 crore.