DDEL Stock Listing Today : The stock of piping solution provider company Dee Development Engineers Limited (DDEL Stock Engineers) has made a blockbuster entry in the stock market today. The company’s stock was listed on BSE at Rs 325 (DDEL Stock Price), while the upper price band under the IPO was Rs 203. In this regard, the investors who have been allotted shares have got a return of 60 percent or Rs 122 per share on its listing itself. This IPO was open from 19 to 21 June 2024 and the price band was Rs 193-203 per share. The question is whether the shares should be sold after making huge profits or should they be held.
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What are the strengths of the company
• Leading player in an industry with significant barriers to entry
• The largest player in process piping solutions in India in terms of installed capacity, offering specialized process piping solutions with strategically located state-of-the-art manufacturing facilities.
• Long standing customer relationships with strong order book
• A wide range of specialized product offerings and services makes the company a comprehensive solutions provider to diversified customers across different geographies and sectors.
• Strong focus on automation and process excellence with an experienced engineering team to enhance operational efficiency.
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Risks and concerns with the company
• The business depends on manufacturing facilities and faces risks due to the use of heavy machinery in the process.
• A slowdown in the oil and gas, power, process, or chemical industries will have a negative impact on business.
• The subsidiaries have incurred losses in the last three financial years and this may continue in the future as well, which may significantly impact the business.
• The Company has experienced and may continue to experience negative cash flows from investing and financing activities.
• The Company faces domestic and international competition, and failure to compete effectively could harm the business.
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Stock Outlook
According to brokerage house Choice Broking, DDEL is an engineering firm that specializes in process piping solutions for various industries. Nearly half of its business comes from the oil and gas sector and the rest from sectors such as power generation, chemicals. Being the largest process piping solution provider in India (in terms of installed capacity), the company has recorded consistent growth in the order book with stability in profitability for the reported period. With favourable macros, DDEL is well positioned to benefit from investment growth in the application sector in the mid-term. However, valuations look somewhat worrying. The brokerage had advised investors to invest cautiously.
How are the company’s financials
Talking about the finances of DDEL, the company’s revenue, expense and PAT in the financial year 2021 is Rs 513 crore, 504 crore and 14.21 crore. Whereas in the financial year 2023 it was 614 crore, 594 crore and 12.97 crore. At the same time, in the first 9 months of the financial year, the revenue, expense and PAT were 558 crore, 539 crore and 14.34 crore.
(Disclaimer: Investing or selling stocks is advised by experts and brokerage houses. These are not the personal views of Financial Express. There are risks in the market, so take expert advice before investing.)