Multibagger Stock Gets Rs 36300000 Boost from Top Power Transmission Company!

A substantial order that strengthens the company’s position in the power transmission market.

Supreme Power Equipment Limited (SPEL) has announced the receipt of a significant domestic order worth Rs 3.63 crore from TRANTRANSCO, a leading player in the power transmission industry. The order involves the manufacturing, supply, and erection of power transformers. The project is scheduled to be completed within three months and will contribute to the company’s growing order book.

Company’s Strong Market Position
SPEL, based in Tamil Nadu, has been a key supplier of power and distribution transformers for over three decades. The company manufactures high-quality transformers for various sectors, including renewable energy. In addition to this, Supreme Power has entered the windmill sector, providing specialized transformers designed to handle switching challenges and voltage fluctuations.

Impressive Financial Performance
For the first half of FY25, SPEL saw a strong performance with a 11.45 per cent YoY increase in consolidated income, reaching Rs 58.61 crores. The company’s EBITDA stood at Rs 12.03 crores, reflecting a margin of 20.53 per cent. Net profit also increased by 10.62 per cent, reaching Rs 7.29 crores. SPEL’s standalone income grew by 14.81 per cent YoY, further reflecting its robust financial health.

Expanding Order Book and New Contracts
With a focus on diversification, SPEL has been expanding its order book, which now stands at Rs 62 crore. The company recently secured a Rs 26 crore order, marking its entry into switchyard construction and commissioning. Additionally, it won a Rs 3.4 crore contract from Seshasayee Paper and Boards for transformer refurbishment. These new contracts reflect SPEL’s growing presence across various sectors.

Stock Performance and Valuation
SPEL’s stock has delivered impressive returns to investors, with a gain of 105 per cent over the past year. The company currently has a market capitalization of Rs 610 crore, and its price-to-earnings (P/E) ratio stands at around 41, significantly lower than the industry average of 66. This makes it an attractive investment opportunity compared to its peers.

New Facility and Growth Plans
SPEL is in the process of constructing a new 6-acre facility, expected to be operational by December 2025. This facility will significantly increase the company’s production capacity, enabling it to manufacture up to 9,000 MVA per year. The investment in this facility is expected to range from Rs 70 crore to Rs 75 crore, with potential revenue generation of Rs 500 crore to Rs 550 crore at full capacity.

Optimistic Future Outlook
SPEL is confident in its growth prospects for the second half of FY25, with an expanding order book and rising demand, especially in the renewable energy sector. The company is also exploring new opportunities to increase its market presence across other states, aiming for strong future growth.

Disclaimer: The article is for informational purposes only and not investment advice.