Elecon Engineering Company has been awarded some prestigious orders aggregating to Rs. 51.7 Crores from following clients for design, engineering, manufacturing, testing, supplying, erectioning and commissioning of Material Handling Equipments and other Equipments.
Techpro Systems Ltd., Chennai – for supply of Stacker & Reclaimer for Iron ore mines project worth Rs 15.5 crore
SAIL Durgapur Steel Plant – for supply of Reclaimer & Wagon Tipplers for the 3 MT expansion project for Rs 36.2 crore
With this, the company’s unexecuted order book stands at Rs 1,823 crore which is 2.2x its FY08 revenues. Of the aforesaid order book, Rs 1,577 crore orders cater to the Material Handling Equipment (MHE) segment while the balance caters to the Industrial Gears Segment.
At CMP of Rs 89, the stock is currently trading at 9.9x its FY09 estimated earnings & 7.6x its FY10 estimated earnings. We recommend a BUY on the stock for a medium to long term horizon.