Transformers and Rectifiers share price zooms nearly 20% to hit all-time high; what’s behind the rally?
Shares of Transformers & Rectifiers India (TRIL), one of the leading manufacturers of transformers, have skyrocketed 19.6% in today’s trade to record a new lifetime high of ₹226 apiece. This impressive rally was attributed to the company’s successful completion of a dynamic short circuit on 105 MVA Transformer.
“Transformers and Rectifiers has successfully completed the most stringent ‘Dynamic Short Circuit Test’ on 105 MVA, 400/√3/220/√3/33 kV class single phase auto transformer, forming a bank of 315 MVA. The dynamic short circuit test was conducted at the National High Power Test Laboratory (NHPTL), Bina, as per the IEC 60076-5 standard,” the company said in today’s exchange filing.
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With the successful completion of this test, the company said it crossed a milestone of a successful dynamic short circuit test on a record 150+ transformers in the last two decades.
The company is engaged in the business of manufacturing and selling various kinds of transformers, such as power and distribution transformers, furnace transformers, rectifier transformers, and specialised transformers.
The company secured multiple orders in the current month. On December 20, it received an order valued at ₹219 crore from the Power Grid Corporation of India. Notably, this marks the second order from Power Grid in just two days. On Tuesday, December 19, the company secured a ₹237 crore order. Before this, on December 19, the company bagged an order worth ₹118 crore from the Uttar Pradesh Power Transmission Corporation Ltd.
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This year so far, the shares have delivered a multibagger return of 300%, moving up from ₹56 to ₹224 apiece. This exceptional performance has been seen since CY20, when the stock recorded a massive 192% return. In the subsequent years, CY21 and CY22, the stock posted returns of 69% and 59%, respectively.
Looking at the long-term performance, the shares have generated a whopping return of nearly 2504% over the last 10-year period.
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The transformer industry is experiencing a surge in orders, and the demand outlook is optimistic, especially in sectors such as railways, renewables, green energy, and power. Within the current industry dynamics, TRIL holds a favorable position and anticipates active participation in the growth narrative of the transformers sector, the company said in its recent investor presentation.
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As of Q2 FY23, the unexecuted order book stood at ₹2,145 crore. Additionally, tenders and inquiries for the domestic market, valued at ₹2,741 crore, are currently in negotiation or at the bidding stage. Furthermore, export orders valued at ₹994 crore are in various stages of negotiation, the company added.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.
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Published: 22 Dec 2023, 06:45 PM IST
