We expect SEL’s net revenue and PAT to grow by 15 percent and 16 percent CAGR over FY18-20E, likely to be driven by good monsoon & new launches.
Swaraj Engines is engaged in manufacturing of engines for fitment into M&M’s "Swaraj" tractors. It derives ~97 percent revenues from sale of tractor engines.
The domestic tractor industry has witnessed a significant turnaround over the past two years, helped by two successive years of normal monsoon. This is well reflected in SEL’s strong financial performance in FY17 & FY18.
Going forward, in its initial forecast, IMD has predicted normal monsoon in 2018 as well. This would keep the demand for tractors buoyant and result in healthy volume offtake for SEL.
We expect SEL’s net revenue and PAT to grow by 15 percent and 16 percent CAGR over FY18-20E, likely to be driven by good monsoon & new launches.Disclaimer: The author is President - Retail Distribution at Religare Securities.The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.Are you happy with your current monthly income? Do you know you can double it without working extra hours or asking for a raise? Rahul Shah, one of the India's leading expert on wealth building, has created a strategy which makes it possible... in just a short few years. You can know his secrets in his FREE video series airing between 12th to 17th December. You can reserve your free seat here.