Suprajit Engineering share price jumps over 9% after Anand Rathi assigns ‘Buy’ rating, forecasts 24% upside

Suprajit Engineering share price jumped more than 9% on Tuesday amid heavy buying momentum in the stock. Suprajit Engineering shares rallied as much as 9.28% to a high of ₹555.45 apiece on the BSE.

Volumes of the stock also spiked as around 17 lakh Suprajit Engineering shares were traded as against its one week average volumes of two lakh shares.

Brokerage firm Anand Rathi initiated coverage on Suprajit Engineering shares with a ‘Buy’ rating and a target price of ₹630 per share, for a time horizon of 12 months. The target price implies an upside potential of 24% from Monday’s closing price. Suprajit Engineering stock is Anand Rathi’s fundamental value pick.

Suprajit Engineering is engaged in the business of manufacturing and selling automotive and other components. The company’s revenue and EBITDA increased by 13% and 7% CAGR from FY19 to FY24 on account of healthy product mix, operational efficiency and healthy order book.

Over the years, the company has been a prominent supplier of cables and other products on the back of capacity expansion, innovation and operating efficiency.

“The company’s strong product portfolio, healthy order book backed by its marquee clients are well placed to report profitability. We believe that the company’s Revenue / EBITDA / PAT is expected to grow at a CAGR of 7% / 16% / 28% respectively over FY24-26E. We believe the stock to witness gradual re-rating on the back of operating efficiency and improved return ratios,” Anand Rathi said in a report.

The rise in discretionary income and change in lifestyle with a significant preference for two-wheelers and Passenger Vehicles (PV) has led to the growth of the automobile sector and this has given a push to auto components suppliers to provide components while maintaining the standard quality, the brokerage firm noted.

Even the government initiatives and adoption of Electric Vehicles (EV) which further received a thrust from customers has further pushed the components industry to increase their product penetration, it added.

Suprajit Engineering share price history

Suprajit Engineering share price has rallied more than 11% in one month and over 15% in three months. Suprajit Engineering stock is up over 35% year-to-date (YTD).

Suprajit Engineering shares hit a 52-week high of ₹639.95 apiece on August 16, 2024. The stock is down around 13% from that level. Suprajit Engineering shares touched a 52-week low of ₹353.25 apiece on October 26, 2023, and have rallied more than 56% since then. 

At 3:00 pm, Suprajit Engineering shares were trading 7.86% higher at ₹548.20 apiece on the BSE.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.