Azad Engineering
Stock Snapshot
Price Performance
Vista Outlook
Basis of our Recommendation
Azad Engineering's recent developments indicate a strong growth trajectory, primarily driven by the inauguration of new manufacturing facilities dedicated to GE Vernova, which enhances capacity and customer integration. Management's optimistic revenue CAGR guidance of over 25% reflects confidence in securing substantial follow-up orders, providing visibility for the next 5-6 years. However, potential risks such as delays in OEM approvals and competitive pricing pressures could impact margins, which are expected to remain under pressure. Vista's financial outlook aligns with these developments, projecting moderate revenue growth and stable EBITDA margins of 33-35%. The company's premium valuation suggests that current market sentiment is optimistic, despite the challenges ahead. Industry dynamics, including rising demand in aerospace and energy sectors, support Azad's growth potential, although competitive pressures and economic fluctuations warrant caution. Over the next 12-24 months, key opportunities include expanding production capacity and deepening customer relationships, while watchpoints include execution risks related to new facility ramp-ups and potential supply chain disruptions
Why We Like This Stock
- Inauguration of new manufacturing facilities enhances capacity and customer integration
- Management projects a revenue CAGR of over 25%, indicating strong growth potential
- Robust order book and strategic contracts with major OEMs provide revenue visibility
Things To Watch Out For
- Margins are expected to remain under pressure due to competitive pricing and execution risks
- Potential delays in OEM approvals could impact growth timelines
- Economic fluctuations and supply chain disruptions pose risks to production and demand
Key Parameters
Financial Snapshot
View Technicals Analysis →| Actuals | Forecast | ||||
|---|---|---|---|---|---|
| FY24 | FY25 | FY26 | FY27 | FY28 | |
| Revenue (Cr.) | 341 | 457 | 603 | 643 | 766 |
| Profit Before Tax (Cr.) | 77 | 124 | 187 | 185 | 228 |
| PBT Margin | 22.6% | 27.1% | 31.0% | 28.7% | 29.8% |
| Net Profit (Cr.) | 59 | 89 | 134 | 131 | 161 |
| Earnings Per Share | 9.1 | 13.8 | 20.6 | 20.1 | 24.9 |
Analyst Recommendations
| Broker | Recommendation | Target Price | Date |
|---|---|---|---|
| Goldman Sachs | ▲ Buy | 3,315 | 29-Sep-2026 |
| ICICI Securities | ▲ Buy | 3,200 | 29-Sep-2026 |
Company Overview
Show Company Profile
Azad Engineering Limited manufactures and sells precision-engineered components in India and internationally. The company offers aerospace, including airfoils/blades for aircraft engines and APUs, body valve, housing mount, housing compressor, fan blisk, mixed flow impeller, housing fan, shell and housing, air frames, aero structure, turbine wheel, nozzle, unison ring, lever arm, hydraulic, fuel inerting, flight control, actuating system, and other products, as well as aerospace standard fluid distribution parts. It provides plate butterfly, sealer, shaft, bearing rod, piston, plate, and sealing ring; aft and fore End Skirt, BB2KP Base, B1 Igniter Body1, and B1 Igniter Body-2; last stage airfoil/blade rotary and welding chamfers and last stage airfoil/ blade stationary components for use in nuclear power turbine solution; and fixed, moving, and stage airfoil/blade rotating for thermal power turbines. In addition, the company offers aerospace actuator systems, such as covers, actuators, housings, guides, poppets, nipples, adapters, tees, elbows; and slips, drill bits, hatch covers, frames, and bonnets for oil and gas up and mid-stream sub-systems. The company also offers 3D rotating airfoil portions of turbine engines and other key products for combustion, hydraulics, flight control, propulsion and actuation which power defence and civil aircraft, spaceships, defence missiles, nuclear power, hydrogen, gas power, oil and thermal power. It serves the aerospace, defense, energy, and oil and gas industries. The company was incorporated in 1983 and is based in Hyderabad, India.