Buy Rajoo Engineers; target of Rs 38: Khambatta Securities

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26 Aug, 2025 12:21

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Khambatta Securities' research report on Rajoo Engineers

Founded by Mr. Chandrakant N. Doshi in 1986, Rajoo Engineers manufactures and sells plastic processing machinery and post-extrusion equipment. Listed on the BSE in 1992, it is the first extrusion company in India to be completely automated and has kept in step with technology to provide customers with the best services.  With its excellence in extrusion machinery, in last 3 decades Rajoo has completed more than 2,000 installations across the globe. It exports to more than 56 countries and its facilities are CE, TUV D&B certified, meeting requirements of different nations for export.  With its diversified product line in extrusion and post -extrusion machines, Rajoo has become a market leader in blown-film lines, sheet lines and thermo-formers on the Indian subcontinent. The management has built up strong goodwill through the quality of its products, constant upgrading technology, after-sales services and value-for-money solutions. Around 60% of its business arises from existing customers.

Outlook
The Company with expanding capacities, focus on value added business may record a top-line and bottom-line growth of 25% and 40% respectively, notching an EPS of Rs 1.4 and Rs 2.1 respectively. Its book value per share is Rs. 9.7 and 12.2 for FY18E and FY19E respectively. At the CMP, the stock is available at an attractive forward P/E of just 11x (FY19E EPS) thus providing an investment opportunity for long-term gains and we believe the share price can go upto Rs 38 (PE - 18x on FY19E EPS) giving an upside of more than 60%.
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