Engineers India a multibagger, see Rs 500 in next 2 years: Prakash Diwan

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Prakash Diwan of prakashdiwan.in told CNBC-TV18, "I get nostalgic thinking how much we used to love Engineers India pre-bonus and then suddenly, as if the bonus announcement just made it a touch-me-not. I remember it became ex at about Rs 180, then slipped to all the way below Rs 160. And interestingly, all this consolidation in the oil & gas space which is happening, you need to understand that for the last 8-10 years, none of these companies, whether it is Bharat Petroleum Corporation, Hindustan Petroleum Corporation or Indian Oil Corporation, they have had money to spend on expansion. They were always cash strapped. They were living on subsidies from the government and suddenly, they get in a position where they have their wallets full. They have got to expand into refining, nothing else. There is no way they can do it."

"I feel a seminal change is happening over the next few years where they will get out of marketing also gradually. This whole splurge of company owned, company operated pumps will come down and the likes of Reliance, Shell will probably fill that gap. So if refining has to go up, who benefits? This is the only company that is eligible to execute a majority of the orders if not all and 28-30 percent margins, where do you get that? I think they already have a Rs 2,500 crore order book. So it is a lovely stock in terms of a multi-bagger which is happening because of structural changes and not because of just some tweaks here and there. So I still like it at this level. But today it has been in a little bit of action so you could probably keep on adding it up and look at a Rs 500 target over the next 2-2.5 years," he said.