Titagarh Wagons' stock climbs by 26% in just two weeks on increased order flows

12 Jul 2022 , 10:43 AM

In (12-07-2022) Tuesday’s sluggish market, shares of Titagarh Wagons (TWL) rose 3% to a four-year high of Rs 127.60 on the BSE. The stock has outperformed the market over the last two weeks, rising 26% on a healthy order book position. Trading had reached its highest point since March 2018. The S&P BSE Sensex, in contrast, was down 0.36 percent at 09:37 am.

In comparison to Sensex’s 3.5% increase during the same period, the stock has increased by 75%. On July 1st, 2017, it reached a record high of Rs 190.

With a capacity to produce 8,400 waggons per year, TWL is one of India’s largest private waggon makers. The firm has expanded outside of India over time by purchasing the Italian metro coach manufacturer Titagarh Firema (TFA) in 2015. Due to the reputation of TFA, Italy, TWL was able to secure a high-value order from Pune Metro in August 2019 for Rs. 1,125 crore.

As of March 2002, TWL had a sizable, well-diversified order book position of Rs 15,123 crore, split between its activities in India (Rs 10,675 crore) and Italy (Rs 4,448 crore).

According to CARE Ratings, the outlook on the long-term rating of TWL is still “Positive” with the expectation of an increase in the scale of operations in the future given the order book as it stands and the maintenance of profitability margins, which will lead to an improvement in return ratios and a comfortable capital structure and debt coverage indicators.

Since FY20, TWL’s domestic operations have improved, mostly as a result of the business’s ability to control its working capital cycle. This has been made feasible mostly because of the influx of mobilization advances together with the quicker recovery of dues through IR and other inventory management tactics used by the organization.