Jash Engineering - Well Placed To Sustain Strong Growth Rate Over Near To Medium Term: HDFC Securities

HDFC Securities Retail Research

Valuation and Recommendation:

Water treatment equipment industry has high entry barriers due to high capital requirement, highly customised products with lengthy approval time, and specialised skillset required for manufacturing such equipments. Jash Engineering Ltd. with its portfolio of well recognised brands, well diversified and reputed clientele is well placed to sustain strong growth rate over near to medium term.

The company has a strong order book of Rs 638 crore as of Q4 FY23, which is executable over the next four-six quarters.

Though the stock has run up lately, given its leadership position and the scope of the industry in which it is present means that the stock may continue to outperform.

About the company

Incorporated in 1973, Jash Engineering, a part of Jash Group, is engaged in the business of manufacturing of varied equipment used in water/wastewater/sea water conveyance, pumping and treatment. the company’s products find application in water intake systems, water and waste water pumping stations and treatment plants, storm water pumping stations, water transmission lines, and process industries (power, steel, cement, paper and pulp, petrochemicals, chemical, fertilisers).

The business is based on brand approval from end users. The company markets its products under Jash, Jash-Schuette, Jash-Rehart , Mahr Maschinenbau , Rodney Hunt , E&M Jash, Shivpad and Sureseal brands.

These brands are approved by major municipal corporations, sewerage boards, consultants and large engineering, procurement and construction companies in India and abroad.

The acquisition of Rodney Hunt in USA, Mahr Maschinenbau in Austria, E&M in Hongkong and Waterfront in UK has ensured that the company has now access in all the principal markets that it is targeting through these brands.

Jash Engineering has also entered into technical and financial collaboration with multiple foreign manufacturers to expand its product portfolio, geographical reach and provide end-to-end solutions for water and waste water industry and bulk solid handling segment in India and abroad.

Exports accounted for ~52% of company’s revenues in FY23. Jash Engineering continues to enjoy leadership position in most of the product groups in the domestic market. In the international markets, the company is progressing towards leadership position in products like water control gates, screens and knife gate valves.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.