Systematix sees Inox India as top pick in industrial gases; 39% upside eyed

Systematix values the Inox India stock at 48x FY27E EPS of ₹34.09 per share and arrives at a target price of ₹1,636

Inox India share price today: Domestic brokerage Systematix Institutional Equities has initiated coverage on Inox India stock, a cryogenic tanks manufacturer, with a 'Buy' rating, saying the company is well-positioned to capitalise on structural growth trends in industrial gases, medical oxygen, and green fuels. 

 

The company's core demand for its products has been driven by end-user sectors like metallurgy, chemicals, and healthcare, and further supported by EPC orders. The next big leg of growth will be catalysed by energy transition projects, the brokerage said.

 

According to Systematix, the company is well-placed to drive long-term value creation and sustain stable margins, backed by its debt-free balance sheet, healthy order pipeline, and operating leverage. These strengths position it as an attractive opportunity in India’s industrial gases and cryogenic solutions sector.

 

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The brokerage estimates Inox's revenue to grow at a 19 per cent Compound Annual Growth Rate (CAGR) over FY25-FY27E to ₹1,849 crore, Ebitda growing at a 19.1 per cent to ₹404 crore, as Ebitda margins increase to 21.9 per cent in FY27E. The profit after tax (PAT) is expected to grow at 17 per cent CAGR to ₹309 crore in FY27E, driven by steady industrial gas demand and accelerating LNG-led energy transition projects.  

 

Systematix values the stock at 48x FY27E EPS of ₹34.09 per share and arrives at a target price of ₹1,636. The target implies a 38.6 per cent upside from Thursday's closing price of ₹1,180.4. 

 

At 11:50 AM, the Inox India stock was trading at ₹1,200.5, up 1.7 per cent on the NSE. In comparison, the NSE Nifty50 was quoting at 25,285.25 levels, up 103 points or 0.4 per cent. The stock's 52-week high was at ₹1,288 and 52-week low was at ₹884.2 on the NSE. The company's total market capitalisation stood at ₹10,896 crore.

Here's why Systematix Institutional Equities is bullish on Inox India:

Market leader in Cryogenics: Inox India holds a dominant 62 per cent share of the domestic LNG tank market and consistently maintains a healthy Ebitda margin of 22 per cent, notably higher than peers whose margins are typically under 16 per cent. With revenues nearly four times that of its nearest competitor, the company stands out for its leadership and innovation in the cryogenic solutions space. It is also the leading exporter of cryogenic tanks from India. 

 

Multiple growth drivers in play: According to analysts, Inox India is well-positioned to benefit from rising gas consumption across industrial sectors like medical, refineries, steel, and emerging industries such as semiconductors and new gas applications. The company also sees strong demand in LNG fuel tanks, fuelling stations, and marine fuel tanks. Additionally, it is expanding into cryogenic equipment for government and specialised applications like MRI cryostats. Inox is ramping up exports, including stainless steel kegs, having secured audit approvals from major global breweries such as AB InBev, Heineken, Paulaner, and Molson Coors.

 

High entry barriers offer a strong moat: According to analysts, Inox India operates in a highly specialised industry where trust and regulatory compliance are critical due to the hazardous nature of cryogenic products. Gaining approvals from gas suppliers, end-users, and international regulators makes market entry extremely challenging. As a result, competition remains limited, with only two other domestic players apart from Inox, reinforcing its dominant position.