Unimech Aerospace and Manufacturing share price was buzzing in trade on Thursday, after domestic brokerage Motilal Oswal initiated coverage on the stock with a ‘Buy' rating and a target price of Rs 1,530. The target price reflects an upside of 27%.
The stock rallied as much as 5.86% to hit a fresh 52-week high of Rs 1,274.85 per share. At 9:37 am, Unimech Aerospace share price was trading 5.30% higher at Rs 1,268. By comparison, BSE Sensex was trading 0.14% higher at 77,296 levels.
The brokerage believes the company is well-positioned to benefit from structural growth opportunities across aerospace, defence, energy and semiconductor equipment sectors, backed by its expanding capabilities and strategic investments.
Here are The Top 4 Reasons Behind The Bullish Call:
Strong Position In Global Aero Tooling And MRO Market
According to MOFSL, Unimech Aerospace has established itself as a key player in the global aero engine and airframe tooling market. Its customer base includes aero engine original equipment manufacturers (OEMs), airframe OEMs and their licensees.
The company manufactures specialised aero engine tools for LEAP, Pratt & Whitney and Rolls-Royce engines, while also supplying airframe tools for Airbus and Boeing platforms. It currently serves 18 customers in this segment.
The brokerage highlighted that competitive pricing, favourable industry tailwinds from new engine programmes and the ongoing shift in maintenance, repair and overhaul (MRO) demand toward Asia are expected to support growth. The aerospace tooling business contributed nearly 80% of the company's FY26 revenue and is expected to remain a key earnings driver in the medium term.
Expanding Presence In Precision Components
MOFSL noted that Unimech is rapidly expanding its precision machined components and subsystem business, catering to industries such as nuclear, aerospace and defence, semiconductors and electromechanical engineering.
The company currently serves 17 customers in this segment and follows a strategy focused on high-mix, low-volume precision engineering products. While the business contributed about 20% of FY26 revenue, the brokerage expects it to grow at a faster pace given the considerably larger total addressable market.
M&A Strategy To Accelerate Growth
The brokerage said mergers, acquisitions and strategic partnerships remain central to Unimech's growth strategy.
Recent initiatives include the acquisition of Hobel Bellows, a joint venture with Kanoo and an investment in Dheya Engineering. These moves are aimed at strengthening capabilities, accelerating innovation and improving access to global markets.
MOFSL added that the company is also exploring opportunities to establish a manufacturing footprint in the US through acquisitions or organic expansion.
Robust Earnings Growth Outlook
MOFSL expects Unimech to deliver a revenue, EBITDA and profit after tax CAGR of 74%, 83% and 57%, respectively, over FY26-FY28.
The brokerage expects growth to be driven by strong momentum in aero tooling, increasing contribution from precision components and benefits from recent acquisitions and joint ventures. It also projects RoE to improve to 16% in FY28 from 9% in FY26, while pre-tax RoCE is expected to rise to 18% from 12% during the same period.
Key risks, analysts believe, include high revenue concentration in aerospace, dependence on the top five customers and major exposure to export markets.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
