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“The Company’s board has given in-principal approval to form a joint venture (JV) with Metzerplas which is one of the largest and most specialised manufacturers of drip irrigation solutions from Israel,” Skipper said in a press release.
The current domestic industry size is estimated at over Rs 5,000 crore and under the Honb’ble Prime Minister’s flagship scheme Pradhan Mantri Krishi Sinchai Yojna (PMKSY) which has been launched with the aim of extending irrigation cover –“Har Khet ko Pani” – and improving water use efficiency – “Per Drop More Crop” – in a focused manner and concentrating on source creation, distribution, management, field application and extension activities in the area of water management, we expect this sector to grow at a robust pace and for the JV to become a major player in it in the years to come, it added.
Analysts at Emkay Global Financial Services maintain ‘buy’ rating on the stock with target price of Rs 327 per share.
“Strong order backlog of around Rs 2,600 crore (1.8x FY17 Engineering product sales) coupled with steady order pipeline ensures robust revenue visibility in the engineering product segment over the next couple of years. Management commentary indicate that Goods and Services Tax (GST) related disruptions are now waning, and majority of dealers have commenced restocking of PVC pipes,” the brokerage firm said in result update.
Going forward, the company is also planning to increasingly bid for railway electrification projects. We expect the company to post robust revenue and PAT growth (FY17-20 CAGR) of around 24% and around 28% respectively, added report.
At 12:40 PM; the stock was trading 7% higher at Rs 281 on the BSE, as compared to 0.34% decline in the S&P BSE Sensex. The trading volumes on the counter more than doubled with a combined 819,014 shares changed hands on the NSE and BSE so far.