Thermax share price surges 14% to hit record high, up 144% in 1 year

Thermax share price surged as much as 14 per cent to hit its fresh record high of 5,347 in early trade on BSE on Wednesday, May 15. 

Thermax share price opened at 4,725 against its previous close of 4,692.45 and jumped 14 per cent to its all-time high of 5,347.15. The stock, however, pared some gains soon. 

Around 9:30 am, Thermax share price traded 8.54 per cent higher at 5,093 apiece. Equity benchmark Sensex was 0.10 per cent up at 73,175 at that time.

Thermax share price has been on a strong uptrend over the last year. The stock hit its 52-week low of 2,192.70 on the BSE on May 19 last year. At the record high of 5,347.15, Thermax share price has surged 144 per cent in about a year.

Thermax declared their Q4 results on 10 May 2024. The topline increased by 19.6 per cent, and the profit increased by 22.01 per cent year-on-year (YoY).

The operating income was up by 47.3 per cent QoQ and by 30.98 per cent YoY.

Also Read: Thermax Q4 Results: Profit rises by 22.01% YoY

What should Indian investors do?

Experts and brokerage firms have mixed views on the stock after the March quarter result.

Brokerage firm HDFC Securities maintained a ‘buy’ call on the stock, with a target price of 4,686.

According to HDFC Securities, Thermax may benefit from investments in clean energy, sustainability, decarbonisation, normalisation of the international market, ramping up of new product portfolio, and impetus on cleaner air and water.

“Thermax may cautiously relook at emerging UMMP opportunities as a large part of the portfolio focus is now on clean energy. We have recalibrated our estimates higher to factor in better growth and margins,” said the brokerage firm.

Also Read: Thermax share price rises 94% in a year: 2 key reasons why Jefferies expects more than 16% gains for the stock

Nirmal Bang has an ‘accumulate’ view on the stock with a target price of 4,400. The brokerage firm expects margins to improve going ahead with a focus on commissioning challenging projects, like rice straw plants and ethanolrelated initiatives.

On the other hand, Kotak Institutional Equities downgraded the stock to a ‘reduce’ from an ‘add’, but raised the fair value to 4,350 from 3,550 earlier.

Kotak pointed out that the company’s Q4FY24 results were healthy on profitability and weak on order inflows, ending a modest year on all key metrics.

“FY2025 revenue growth and margin may carry impediments in ordering (flat over FY2022-24). Thermax expects ordering to revive based on the return of large orders, even as operational issues limited the scale-up of select new lines of work,” Kotak said.

“We increase estimates by 7 per cent and multiple to 46 times (from 43 times) and roll forward to June 2026E EPS-based fair value of 4,350 (from 3,550). We downgrade the stock to ‘reduce’ from ‘add’ on expensive more than 60 times one-year forward earnings multiple,” said Kotak.

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Disclaimer: The views and recommendations above are those of individual analysts, experts, and brokerage firms, not Mint. We advise investors to consult certified experts before making any investment decisions.

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Published: 15 May 2024, 09:25 AM IST

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