Sansera Engineering — Tailwinds In Place For Profitable Growth: ICICI Securities

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..'Buy' rating maintained. Target Price updates to Rs. 1,033 from Rs. 1001.Key takeaways from management interaction:-Sansera Engineering Limited has invested Rs3.5bn towards gross block for the Bidadi plant. SEL expects revenue to ramp up to Rs4.8bn-5bn by FY25 from the Bidadi facility, which has both steel and aluminum forging capabilities. By putting a new 4,000T press in this plant, the company is aiming to make large steel crankshafts inhouse for 6-litre genset engines in addition to making large aluminum components for 2Ws for OEMs like Royal Enfield, KTM, etc. SEL has no plans to enter the casting business in the foreseeable future, but will focus towards diversification of the forging business only. The new aerospace facility’s peak revenue is estimated at Rs3.5bn with machineries from the older plant getting shifted here. As against Rs900mn aerospace revenue in FY23, SEL is targeting Rs2.5bn revenue from the segment by FY25.SEL is looking forward to grow its exports by 40-50% in FY23 led by expansion in the aluminum forging and aerospace businesses along with addition of new businesses from Polaris ATV, Tesla, CNH, and overall growth in key markets. Company is aiming to improve EBITDA from 16% currently to 18-19% by FY25 through improvement in exports and aerospace mix, and improved operating leverage. SEL aims to reduce ‘net debt / equity’ from 0.55x currently to 0.4x by FY25 along with operating at 8-9% capex/sales ratio and subsequently increase the RoCE towards 20% with improved profitability. .Click on the attachment to read the full report:.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Sansera Engineering — Tailwinds In Place For Profitable Growth: ICICI Securities

Sansera Engineering's target price revised upwards to Rs 1,033 by ICICI Securities.

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