Reduce Techno Electric; target of Rs 1600: Emkay Global Financial

reduce

Emkay Global Financial's research report on Techno Electric

TEEC, a top EPC player with capabilities to provide solutions in T&D (EPC work for substation and distribution management system) and power generation (BoP and FGD) has recently diversified into high-growth businesses such as smart meter and data center. With a robust order backlog of Rs91bn (L1 position: Rs12bn), along with a strong enquiry pipeline, we expect TEEC’s revenue to more than double in the next 2 years. Order prospects are resilient, supported by the T&D, smart metering space, given the aggressive targets for renewable capacity adds and RDSS-led ordering. We expect multifold growth in the datacenter segment on the back of rising digitization globally benefiting TEEC.

Outlook

We downgrade (on recent sharp run-up in the stock price) Techno Electric (TEEC) to REDUCE with revised upwards TP of Rs1,600/sh (+2% upside).

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Techno Electric - 210824 - emkay