Shakti Pumps - Healthy Order Book, Promising Pipeline Provides Vast Opportunity: IDBI Capital

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..IDBI Capital Report.Key Highlights and Investment Rationale Healthy order book and promising pipeline: Shakti Pumps India Ltd. has order book of Rs 9 billion (one time FY23 revenue) out of which two large orders constitute Rs 6.5 billion and the rest being the Uganda and other orders. Orders are to be typically executed in 90 days. The company expects another large tender of 50,000 pumps (~Rs 16 billion) from HAREDA in the next four-six months out of which it expects to garner a sizeable chunk of orders of 40-50%. With around 4 million (~Rs 1.3 trillion) solar pumps to be installed in next five years, order pipeline looks promising. Head room for growth: Shakti Pumps with capacity of 500,000 pumps is operating at utilisation of 40%. Present capacity is adequate for annual revenue of Rs 25 billion, which is 2.5 times of FY23 revenue. With a strong market share of 30% plus, 40% utilisation levels along with strong emphasis on the ground level execution of the PM-KUSUM scheme, Shakti Pumps sees headroom for growth ahead. Company has guided for revenue of Rs 12 billion (up 24% YoY) for FY24E with improvement in Ebitda margin to 12-15%. (FY23 margin was 7%)..About the companyIncorporated in 1982 and led by Mr. Dinesh Patidar, Shakti Pumps has established a solid presence in the pumps industry. The company is a pioneer in manufacturing 100% energy efficient stainless-steel submersible solar pumps and motors. Shakti Pumps holds a dominant position with ~30% plus market share in the domestic solar pump market under the PM KUSUM scheme. The company has a manufacturing facility of 500,000 pumps located at Pithampur (Madhya Pradesh), well supported by advanced in-house research and development and robust backend support.The company has a wide range of products having varied applications, offering more than 1,200 product variants. The products have varied applications from agricultural, building services, power, oil and gas, metals and mining and others..Click on the attachment to read the full report:.Tata Motors' JLR Q2 Wholesales At 96,800 Units: Motilal Oswal.DISCLAIMERThis 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.

Shakti Pumps - Healthy Order Book, Promising Pipeline Provides Vast Opportunity: IDBI Capital

With a strong market share of 30%+, 40% utilisation levels, emphasis on execution, Shakti Pumps sees headroom for growth ahead.

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