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Titagarh Wagons Shares Rise 8%, Board to Consider Fundraising on Saturday

Shares of Titagarh Wagons (TWL) rose 8% in intraday trade on Friday.

Shares of Titagarh Wagons (TWL) rose 8% in intraday trade on Friday to hit a fresh high of Rs 427 on the BSE ahead of a board meeting on Saturday to consider fundraising plans.

A meeting of the company’s board of directors is scheduled for Saturday, June 10, 2023, to consider, evaluate and approve a proposed capital raising.

Fundraising will be considered through the issue of shares or other securities, including through a preferential offering, a qualified institutional placement, a rights issue, or through any other permissible means or combination thereof, subject to regulatory approval, the company said.

TWL was quoted 6% higher at Rs 418.45 at 2:52 pm, while the S&P BSE Sensex was down 0.32%. The index has risen 91% so far this year, compared with a 2.4% gain for the benchmark index.

TWL, through its prominence in passenger and freight rolling stock, provides mobility solutions to billions of people. TWL is the largest privately-owned manufacturer of freight cars and an established player in passenger rail cars (EMU, MEMU).

In its FY23 investor presentation, TWL said the highest-ever single order for Indian Railways (IR) is being executed for the supply of 24,177 wagons totalling Rs 7,800 crore.

The BHEL & TWL consortium has won the contract to supply and maintain 80 Vande Bharat trains to Indian Railways. The value of the order amounted to Rs 23,100 crore (including maintenance value for 35 years), and Titagarh’s share was 51%.

A Ramkrishna Forgings and Titagarh consortium has secured a forged wheel contract from Indian Railways. It is setting up a forged wheel manufacturing plant that produces 200,000 forged wheels annually. IR will ensure an annual offtake of 80,000 wheels for 20 years. The tender has an assured offtake value of approximately Rs 12,600 crore, and Titagarh’s share is 50%.

TWL said it currently operates about 5-6 coaches per month. By March 2023, the company will have delivered 17 trains and will initially increase this to 20 cars per month. It plans to increase passenger coaches capacity to 70 carriages, 70-75 coaches in the next 2-3 years coach monthly.

According to management, the company’s outlook is bright, and the company’s turnaround has been delayed, which management expects to happen in FY23. However, management estimates that current orders will help it break even, at least on a positive EBITDA level in FY24.

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