Titagarh Rail Systems shares are currently down 38% from their peak value of ₹1,896.50, achieved on June 27, 2024. Today, the stock is trading at ₹1,178 on the BSE. Despite the decline, the stock experienced a notable rise of 8.42% during the current trading session, reaching an intra-day high of ₹1,185.70.
This uptick occurred even as the benchmark indices attempted to recover from significant losses seen previously. The company's market capitalisation stands at ₹15,844 crore, with a total of 2.37 lakh shares exchanging hands, resulting in a turnover of ₹27.33 crore.
Historical stock performance
Over the past three years, Titagarh Rail has delivered impressive multibagger returns of 1,072%, and it has increased by 645% over the last two years. However, it's worth noting that the stock hit its 52-week low of ₹703.80 on August 18, 2023, showcasing its volatility in the share market investment landscape.
Technical analysis
Currently, Titagarh Rail shares are trading above the 5-day, 10-day, and 20-day moving averages yet remain below the 30-day, 50-day, 100-day, 150-day, and 200-day moving averages. The stock's relative strength index (RSI) stands at 36.2, indicating it is not in either the overbought or oversold territory, which suggests a period of stability could be forthcoming. This technical positioning may influence potential share market investment strategies.
SBI Securities' outlook
SBI Securities has highlighted Titagarh Rail as a promising option for the Diwali season, assigning a price target of ₹1,510 to the stock. They anticipate that the current share price reflects the fiscal year 2025/26 P/E multiple of 43.7x/31.6x, based on consensus earnings estimates from Bloomberg.
According to their analysis, Titagarh Rail is well-placed to benefit from favourable growth drivers, including increasing demand, attractive rail value chain opportunities, enhanced infrastructure spending, and supportive policies.
Risks to consider
SBI Securities has also outlined several risks that could impede the company's growth trajectory. These include potential slowdowns in railway capital expenditure, a high reliance on Indian Railways for business, and intensifying competition within the sector. Investors considering share market investment should be aware of these factors, especially as the firm prepares to announce its Q2 earnings on October 26.
Recent earnings report
In the latest quarter, Titagarh Rail Systems reported modest earnings results. The company saw an 8.4% increase in net profit year-on-year for Q1, amounting to ₹67 crore compared to ₹61.79 crore in the same period last year. However, revenue decreased by nearly 1% to ₹903 crore from ₹910.80 crore year-on-year.
Additionally, EBITDA fell by 4.1% to ₹101.7 crore from ₹106.1 crore in the corresponding quarter of the previous fiscal year. This decline in revenue had a direct impact on the company's operational performance, with EBITDA margins contracting by 50 basis points year-on-year to 11.2%.
Key takeaways
Given the current trading price and the established price targets from various analysts, investors may find opportunities for share market investment in Titagarh Rail. The upcoming earnings announcement will likely further influence the stock's trajectory as market participants assess the company's performance amidst ongoing market fluctuations.
For android only