Azad Engineering share price target 2024, 2025, 2026, 2027, 2030 prediction
Azad Engineering Ltd. (AEL) is one of the key manufacturers of qualified product supplying to global original equipment manufacturers (OEMs) in the energy, aerospace and defence, and oil and gas industries, manufacturing highly engineered, complex and mission and life-critical components. In this article, we will look at Azad Engineering share price target 2024, 2025, 2026, 2027, 2030 prediction.
The company is planning to raise Rs 740 crore via an initial public offering (IPO) that will open for subscription on December 20, 2023, and close on December 22, 2023. The price band for the issue has been fixed at Rs 499-524 per share.
In this blog post, we will analyze the company’s business, competitors, growth opportunities, strengths, weaknesses, opportunities, threats, financials, and key things to watch out for Azad Engineering Stock.
Consider reading: DOMS Industries Share Price Target
Page Contents
Azad Engineering share price target 2024, 2025, 2026, 2027, 2030
| Year | Minimum Share Price Target | Maximum Share Price Target | Average Share Price Target |
|---|---|---|---|
| 2024 | ₹1,080 | ₹1,240 | ₹1,160 |
| 2025 | ₹1,350 | ₹1,550 | ₹1,450 |
| 2026 | ₹1,688 | ₹1,938 | ₹1,813 |
| 2027 | ₹2,109 | ₹2,422 | ₹2,266 |
| 2028 | ₹2,637 | ₹3,027 | ₹2,832 |
| 2029 | ₹3,296 | ₹3,784 | ₹3,540 |
| 2030 | ₹4,120 | ₹4,730 | ₹4,425 |
| 2031 | ₹5,150 | ₹5,913 | ₹5,531 |
| 2032 | ₹6,437 | ₹7,391 | ₹6,914 |
| 2033 | ₹8,047 | ₹9,239 | ₹8,643 |
Consider reading: Mufti Jeans Share Price Target
Azad Engineering share price target 2024
| Year | Minimum Share Price Target | Maximum Share Price Target | Average Share Price Target |
|---|---|---|---|
| 2024 | ₹1,080 | ₹1,240 | ₹1,160 |
Azad Engineering share price target 2024: In 2024, analysts projected Azad Engineering share price target to range from a minimum of ₹1,080 to a maximum of ₹1,240, with an average target of ₹1,160.
Azad Engineering share price target 2025
| Year | Minimum Share Price Target | Maximum Share Price Target | Average Share Price Target |
|---|---|---|---|
| 2025 | ₹1,350 | ₹1,550 | ₹1,450 |
Azad Engineering share price target 2025: For the year 2025, analysts anticipated Azad Engineering’s share price to be in the range of ₹1,350 (minimum) to ₹1,550 (maximum), with an average target of ₹1,450.
Azad Engineering share price target 2026
| Year | Minimum Share Price Target | Maximum Share Price Target | Average Share Price Target |
|---|---|---|---|
| 2026 | ₹1,688 | ₹1,938 | ₹1,813 |
Azad Engineering share price target 2026: In 2026, Azad Engineering’s share price target was estimated to have a minimum target of ₹1,688, a maximum target of ₹1,938, and an average target of ₹1,813.
Azad Engineering share price target 2030
| Year | Minimum Share Price Target | Maximum Share Price Target | Average Share Price Target |
|---|---|---|---|
| 2030 | ₹4,120 | ₹4,730 | ₹4,425 |
Azad Engineering share price target 2030: For the year 2030, analysts expected Azad Engineering’s share price to fall within the bracket of ₹4,120 (at the lower end) to ₹4,730 (at the upper end), while setting an average target of ₹4,425.
Consider reading: INOX India CVA Share Price Target
Competitors of Azad Engineering Stock
Azad Engineering stands out in the global precision manufacturing industry, competing with notable firms from China, Europe, the USA, and Japan. Its rivals include industry leaders like Walker Forge, Progressive Gears Industries, Park-Ohio, Supply Technologies, Applied, Scot Forge, MSC, El Forge, Kaman Industrial Technologies, and Columbia Metals. These companies, while offering comparable products and services, vary in aspects such as scale, quality, technological advancement, and customer demographics.
Azad Engineering distinguishes itself with a robust EBITDA margin, dynamic revenue growth, superior return ratios, and a diverse product portfolio. The company’s strong brand reputation and enduring customer relationships provide leverage in pricing, consistent order flow, and repeat business. Furthermore, the industry’s high entry barriers and rigorous qualification processes fortify its position by minimizing the threat from new market entrants and alternative products.
Consider reading: Vedanta Share Price Target
Growth Opportunity for Azad Engineering Stoc
Azad Engineering is poised for significant growth in the dynamic precision components industry, particularly in the energy, aerospace, and defense, and oil and gas sectors. Industry forecasts, including insights from the EY Report, project substantial market expansion.
Specifically, the energy sector’s market for precision components is expected to grow at a CAGR of 5.1%, increasing from USD 9.2 billion in 2020 to USD 11.8 billion by 2025. In the aerospace and defense sector, a robust 7.4% CAGR is anticipated, raising the market size from USD 16.9 billion to USD 24.1 billion within the same period. The oil and gas industry is not far behind, with an estimated growth of 4.9% CAGR, taking the market from USD 4.4 billion to USD 5.6 billion by 2025.
Capitalizing on these opportunities, Azad Engineering’s diverse product portfolio, established customer base, and reputation for quality product delivery set it apart. The company is exploring expansion into new regions such as Europe, the Middle East, and Japan, building on its existing international footprint.
Innovation remains a cornerstone of Azad Engineering’s strategy, with plans to invest in additive manufacturing, digital solutions, and integrated systems, catering to the evolving needs of its clientele.
The upcoming IPO presents an opportunity for Azad Engineering to further strengthen its market position. The company aims to utilize the net proceeds for strategic investments in plant and machinery and debt repayment, enhancing capacity, operational efficiency, and overall profitability.
Consider reading: Muthoot Microfin Share Price Target
SWOT Analysis of Azad Engineering Stock
Strengths:
- Azad Engineering is a specialized player in the precision manufacturing sector, renowned for producing critical components with impeccable quality and adhering to zero-defect standards.
- The company boasts a diverse product range serving high-growth industries like energy, aerospace, defense, and oil & gas.
- Strong partnerships with global OEMs, including General Electric, Honeywell International Inc., Mitsubishi Heavy Industries, Siemens Energy, Eaton Aerospace, and MAN Energy Solutions SE.
- It outperforms competitors with superior EBITDA margins, accelerated revenue growth, higher return ratios, and a varied product assortment.
- Azad Engineering leverages cutting-edge technologies such as 3D printing, robotics, automation, and AI, boosting its capabilities and operational efficiency.
- The industry’s high entry barriers and stringent qualifications curtail the risk of new competitors and product substitutes.
Weaknesses:
- The FY23 bottom line showed a decline due to one-time adjustments and amortization.
- Heavy reliance on a limited customer base, notably General Electric, which contributed to a significant portion of FY23 revenue.
- Exposure to foreign exchange risks, with the majority of FY23 revenue in foreign currencies, predominantly the US dollar.
- Operating in highly regulated sectors brings regulatory and compliance risks requiring numerous approvals, certifications, and licenses.
- Susceptibility to cyclical and seasonal fluctuations in the industries it serves, impacting product demand and pricing.
Opportunities:
- Growing demand for precision components in the energy, aerospace, defense, and oil & gas sectors, spurred by needs for energy efficiency, reduced emissions, and security.
- Expansion potential in new markets like Europe, the Middle East, and Japan, where the company already has a product presence.
- Developing new offerings in additive manufacturing, digital solutions, and integrated systems to meet evolving customer requirements.
- The upcoming IPO’s net proceeds will fund plant and machinery purchases and debt repayment, enhancing capacity, efficiency, and profitability.
Threats:
- Intense competition from both local and international firms offering similar or superior products and services, possibly at lower prices or higher quality.
- Price volatility of exotic/super alloys, a major component of the company’s material costs.
- Potential disruptions in supply chain, production, or delivery due to unforeseen events like natural disasters, pandemics, accidents, strikes, etc.
- Regulatory, policy, or customer preference changes could impact product demand, pricing, or quality standards.
Azad Engineering Company Financials
The financial health of Azad Engineering over the past few years and into the first half of FY24 is captured in the following data:
Table: Azad Engineering Financial Indicators
| Particulars (in Rs crore) | FY21 | FY22 | FY23 | H1 FY24 |
|---|---|---|---|---|
| Revenue from Operations | 123.0 | 194.4 | 251.7 | 146.6 |
| EBITDA | 36.2 | 62.2 | 72.3 | 41.9 |
| EBITDA Margin (%) | 29.4 | 32.0 | 28.7 | 28.6 |
| Profit After Tax (PAT) | 20.4 | 33.1 | 8.5 | 24.6 |
| PAT Margin (%) | 16.6 | 17.0 | 3.4 | 16.8 |
| Return on Equity (%) | 12.6 | 15.8 | 15.8 | 16.1 |
| Return on Capital Employed (%) | 17.5 | 20.9 | 20.9 | 21.0 |
| Earnings Per Share (Rs) | 3.7 | 6.1 | 1.6 | 4.5 |
Analysis:
- Revenue Growth: Azad Engineering exhibited consistent growth in its operational revenue, climbing from Rs 123.0 crore in FY21 to Rs 251.7 crore in FY23, and maintaining a healthy trajectory into H1 FY24 with Rs 146.6 crore.
- EBITDA Performance: The EBITDA has shown an upward trend, reaching Rs 72.3 crore in FY23, indicative of operational efficiency and profitability. The EBITDA margin, while slightly decreased in FY23 compared to FY22, remains robust.
- Profitability: The Profit After Tax (PAT) has seen fluctuations, with a notable dip in FY23 at Rs 8.5 crore, but a strong rebound in H1 FY24, signifying a potential turnaround in profitability.
- Investor Returns: Both Return on Equity (RoE) and Return on Capital Employed (RoCE) metrics have been improving, suggesting efficient use of shareholder equity and overall capital.
- Earnings Per Share: The EPS witnessed a drop in FY23 but showed signs of recovery in H1 FY24, reflecting the company’s earnings power and potential value to shareholders.
Consider reading: IEX Share Price Target
Valuation of Azad Engineering Stock
Azad Engineering’s imminent stock market debut on December 28, 2023, post its Initial Public Offering (IPO), is set to be a significant event. The IPO’s pricing is in the range of Rs 499-524 per share, leading to a projected post-issue market capitalization between Rs 2,724 crore and Rs 2,861 crore. At the upper price band, the stock’s Price-to-Earnings (P/E) ratio stands at 81.6 times its FY23 earnings, surpassing the industry average of 51.4 times.
Key Valuation Highlights:
- Premium Valuation Justification: Despite a higher P/E ratio compared to industry norms, Azad Engineering’s exceptional EBITDA margin, accelerated revenue growth, impressive return ratios, and a diverse product portfolio provide a solid foundation for its premium valuation.
- Strong Order Book: With an order book valued at Rs 1,100 crore as of September 30, 2023, the company demonstrates promising revenue visibility for the forthcoming two to three years.
- Debt Position: A low debt-to-equity ratio of 0.2 as of September 30, 2023, indicates a sound financial structure, expected to strengthen further post-IPO.
- Healthy Cash Flow: The company’s robust cash flow from operations stands as a testament to its operational efficiency and is a positive indicator for future expansion endeavors.
Given these factors, Azad Engineering Stock presents itself as an attractive long-term investment for those looking to diversify into the precision manufacturing industry. Its financial health and growth prospects position it favorably in the market.
Consider reading: Cochin Shipyard Share Price Target
Final Thoughts on Azad Engineering share price target 2024, 2025, 2026, 2027, 2030
Azad Engineering emerges as a distinguished entity within the precision manufacturing landscape, specializing in creating vital components for sectors like energy, aerospace, defense, and oil & gas. Its varied product range, robust customer relationships, use of advanced technology, and commitment to high-quality standards set it apart.
Operating in a rapidly growing market, Azad Engineering is well-positioned to benefit from the increasing global demand for precision components. The potential for geographic expansion, coupled with the development of innovative products and services, further bolsters its market standing. Additionally, the company’s drive to enhance capacity, efficiency, and profitability aligns perfectly with its growth trajectory.
Financially, Azad Engineering has demonstrated commendable performance, marked by a high EBITDA margin, accelerated revenue growth, impressive return ratios, and a diversified product suite. The company’s valuation, when weighed against its growth prospects, robust order book, and low debt levels, appears justified and reasonable.
Considering these factors, Azad Engineering Stock stands out as a compelling investment choice for long-term investors seeking exposure to the precision manufacturing sector. Its robust fundamentals, growth potential, and financial health make it a noteworthy addition to investment portfolios.
FAQs on Azad Engineering share price target 2024, 2025, 2026, 2027, 2030
What is Azad Engineering share price target 2024?
In 2024, analysts forecasted that Azad Engineering share price target would vary from a minimum of ₹1,080 to a maximum of ₹1,240, while establishing an average target at ₹1,160.
What is Azad Engineering share price target 2025?
In 2025, analysts expected Azad Engineering share price target to fall within the range of ₹1,350 at the minimum to ₹1,550 at the maximum, while setting an average target at ₹1,450.
What is Azad Engineering share price target 2026?
During 2026, Azad Engineering share price target was estimated to include a minimum target of ₹1,688, a maximum target of ₹1,938, and an average target of ₹1,813.
What is Azad Engineering share price target 2030?
In the year 2030, analysts anticipated that Azad Engineering share price target would range from ₹4,120 at the lower end to ₹4,730 at the upper end, with an average target set at ₹4,425.
