Aeroflex Inds up 15%
Aeroflex Industries is among the top gainers on the BSE today, surging 14.70% to Rs. 563.90, a gain of Rs. 72.25 over its previous close of Rs. 491.65. The stock opened at Rs. 533.30 and touched an intraday high of Rs. 564.35. Trading volume jumped to 21.27 lakh shares against its two-week average of 2.08 lakh shares, a more than tenfold increase, with turnover at Rs. 116.66 crore. Market capitalisation stood at Rs. 7,462 crore. Market depth showed sell quantity at 1,29,661 shares against buy quantity of 1,02,932 shares, indicating some profit booking despite the sharp rally.
Trigger
- Strong Q2 FY27 consolidated results announced on October 28.
- Total revenue rose 87% YoY and 42% QoQ to Rs. 207.68 crore.
- EBITDA increased 94.5% YoY and 50.3% QoQ to Rs. 50.34 crore.
- EBITDA margin improved to approximately 24.3%.
- Net profit jumped 157% YoY and 94.6% QoQ to Rs. 36.56 crore.
- H1 FY27 revenue grew 81% YoY to Rs. 353.66 crore.
- Rs. 202 crore capacity expansion programme underway in stainless-steel hoses and liquid-cooling systems.
The sharp earnings growth reflects improving demand for Aeroflex's stainless-steel flexible flow solutions, used across oil and gas, chemicals, pharmaceuticals, power and data centres. Higher revenue, operating leverage and an improving product mix have helped strengthen margins. Demand for liquid-cooling systems used in AI-driven data centres is emerging as an additional growth opportunity, alongside encouraging enquiries from the US and Europe.
Another important sentiment driver is the company's Rs. 202 crore expansion plan, announced earlier this month.
One point worth examining is that the company changed its depreciation method from April 2026, reducing depreciation expenses by Rs. 8.41 crore in H1 FY27 and contributing to higher reported profits. This makes operating performance and cash generation particularly important when assessing earnings quality.
Despite strong earnings, Aeroflex trades at a consolidated PE of 83.40 times and price-to-book of 23.61 times, leaving limited room for execution disappointments.