Stock Market

Add AIA Engineering, target Rs 1,811: IIFL

   Download Android App    Share in      FullScreen   CheckVideos

IIFL has given an 'add' recommendation on AIA Engineering (AIAE) with a target price of Rs 1,811. Shares of AIA Engineering traded at Rs 1,746.65 around 2:30 pm on 26 June, 2019.

The brokerage has set a one-year horizon for the stock to hit the target price.

India’s exports of cast grinding media registered 12 per cent CAFR over 2015-18, which is largely in line with AIAE’s volume growth over FY16-19.

This was largely driven by increased volumes exported to countries such as Australia, Ghana, USA and Tanzania.

Improved consumption of cast media in the mining industry coupled with increased penetration by AIAE in key geographies also contributed to this growth. In the mining segment, AIAE’s focus has been to target ores of iron, copper, gold and platinum, for its chrome cast media products.

Over the past four years, share of imports from India in total imports grew in the key mining geographies of Australia, USA and Ghana.

South Africa (the largest market for India exports) also witnessed growth, at 10 per cent CAGR over 2015-18, even as market share remained stable, at over 95 per cent.

At the same time, share of imports from India declined in Russia and Brazil, due to rise in competition from China and Chile, respectively. AIAE is in the process of expanding its capacity, from 340kt to 490kt over FY20-21ii.

AIAE would focus on increasing market share in the key mining regions of Australia, USA, Canada and Africa.

Simultaneously, the company’s announced focus on market share gains means that an aggressive pricing strategy should help regain market share in other geographies.

The ongoing shift from forged grinding media to chrome cast media, given gains on metal recovery from ore, lower re-agent requirement would also aid volumes against forged players. Key argument for AIAE’s volume growth has been the gradual shift of preference from forged grinding media to high chrome cast grinding media in the mining segment.

AIAE’s target ores include iron ore, copper, gold and platinum in the mining segment, with its geographical focus being top mining countries such as Australia, South Africa, Canada and Zambia.




Unlimited Portal Access + Monthly Magazine - 12 issues-Publication from Jan 2021

Buy Our Merchandise (Peace Series)

 

Contribute US to Start Broadcasting


It's Voluntary! Take care of your Family, Friends and People around You First and later think about us. Its Fine if you dont wish to contribute and if you wish to contribute then think about the Homeless first and Feed them. We can survive with your wishes too :-). You can Buy our Merchandise too which are of the finest quality.

Debit/Credit/UPI

UPI/Debit/Credit

Paytm

STRIPE

Details
Category: Stock Market


21