Stock Snapshot
Price Performance
Recommendation Rationale
Favorable growth outlook supported by strategic acquisitions and government initiatives, tempered by domestic demand challenges.
Basis of our Recommendation
Electrosteel Castings Limited is strategically positioned to benefit from India's water infrastructure initiatives, particularly the Jal Jeevan Mission 2.0, which is expected to drive demand. The company's robust export capabilities and recent acquisition of T.I.S. Service S.p.A. enhance its growth potential. However, challenges such as domestic demand slowdowns and geopolitical tensions present risks that could impact performance.
Why We Like This Stock
- Strong positioning to capitalize on government water infrastructure projects
- Robust export capabilities to over 130 countries
- Strategic acquisition of T.I.S. Service S.p.A. to diversify product offerings
Things To Watch Out For
- Slowdown in domestic demand due to delays in government fund disbursements
- Geopolitical tensions affecting export markets
Key Parameters
Financial Snapshot
| Actuals | Forecast | ||||
|---|---|---|---|---|---|
| FY24 | FY25 | FY26 | FY27 | FY28 | |
| Revenue (Cr.) | 7,478 | 7,320 | 5,918 | 5,101 | 4,665 |
| Profit Before Tax (Cr.) | 957 | 865 | 257 | 241 | 216 |
| PBT Margin | 12.8% | 11.8% | 4.3% | 4.7% | 4.6% |
| Net Profit (Cr.) | 702 | 647 | 203 | 194 | 173 |
| EPS | 11.4 | 10.5 | 3.3 | 3.1 | 2.8 |
Company Overview
Show Company Profile
Electrosteel Castings Limited manufactures and supplies ductile iron (DI) pipes, ductile iron fittings (DIF) and accessories, and cast iron (CI) pipes in India and internationally. The company offers ductile iron pipes and fittings which are used in various applications, including raw and clear water transmission, distribution network of potable water, water supply for industrial/process plants, ash-slurry handling and disposal systems, on-shore and off-shore fire-fighting systems, desalination plants, sewerage and waste water force mains, gravity sewerage collection and disposal systems, storm water drainage piping, domestic and industrial disposal systems, recycling systems, piping work in water and sewage treatment plants, vertical connection to utilities and reservoirs, piling for ground stabilization, trenchless application, and protective piping under carriageways; ductile iron flange pipes used for temporary, over-ground and exposed installations, vertical pipelines, interconnection and connection for accessories, and as a restrained joint application; and ductile iron restrained joint pipes. It also provides cast iron pipes, metallurgical coke, sinter, sponge iron, ferro silicon, pig iron, low ash metallurgical coke, and silico manganese ferro alloy. In addition, the company offers cement under the brand name of SPL GOLD. The company was formerly known as Dalmia Iron and Steel Ltd. Electrosteel Castings Limited was incorporated in 1955 and is based in Kolkata, India.