During Thursday’s trading session, the shares of a company engaged in the engineering and mould base industry hit a 2 percent upper circuit at Rs. 836 on BSE, after securing a Major order from a prominent defence products supplier for the supply of 1 lakh units of Empty Artillery Shell.
With a market cap of Rs. 470.3 crores, the shares of Sunita Tools Limited opened in the green at Rs. 836, up by 2 percent, as against its previous closing price of Rs. 819.65.
What’s the news
According to the latest regulatory filings with the BSE, Tripathi Aerotech & Weapons Systems Private Limited, a subsidiary of Sunita Tools Limited, received a *Major Letter of Intent (LOI) from a prominent defence products supplier.
The order involves the supply of 1 lakh units of 155mm M107 empty artillery shells annually, contingent upon the submission and approval of trial samples. The approval has been received by the company’s subsidiary Tripathi Aerotech & Weapons Systems Private Limited, formerly Shigna Industrial Corporation.
The LOI specifies that the supply must be completed within one year of the trial samples’ acceptance. The customer has been given an 8-month period to establish the necessary infrastructure for large-scale manufacturing. Meanwhile, trial samples and low-volume batches can be supplied from the subsidiary’s existing facility.
NOTE – The significant orders range from Rs. 1-100 crore, Large orders are valued between Rs. 100-200 crore, Major orders are those valued between Rs. 200-300 crore, and Mega orders are valued between Rs. 300-500 crore.
About the Subsidiary
Tripathi Aerotech and Weapons Manufacturing Private Limited is a company formed through the collaboration of Shigna Industrial Corporation, owned solely by Mr. Rajeev Tripathi, and Sunita Tools Limited.
Shigna Industrial Corporation and Tripathi Aerotech are registered vendors and currently work with various defence and ordnance factories and establishments across India.
Previous News
On 16th December, Sunita Tools Limited announced a strategic move to grow its presence in Defence, Aerospace and Weapons manufacturing, by acquiring a 55% majority stake in Tripathi Aerotech and Weapons Manufacturing Pvt Ltd.
This acquisition was a part of Sunita Tools Limited’s plan to expand its product range to include aerospace, defence, and weapons manufacturing. It will also allow the company to take on large orders for gun parts and artillery shell cases.
By combining its 36 years of technical expertise with the capabilities of Tripathi Aerotech, Sunita Tools aims to manufacture a wide range of defence-related products for both the Indian and global markets.
The company expects this expansion to enhance its defence and aerotech capabilities, contributing to increased profitability. Additionally, other subsidiary companies within the Sunita Tools Group, which have similar machinery, will also benefit from this acquisition.
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Financials
The company reported a significant growth in revenue from operations, experiencing a year-on-year rise of nearly 15 percent, increasing from Rs. 13.84 crores in FY23 to Rs. 26 crores in FY24.
Similarly, during the same period, the company’s net profit increased from Rs. 3 crores to Rs. 4.8 crores, representing a rise of around 60 percent YoY.
Stock Performance
The stock has delivered multibagger returns of nearly 265 percent in one year, while around 20.4 percent of positive returns in the last six months. Likewise, the shares of Sunita Tools have given positive returns of about 55.5 percent in the last one month.
About the company
Sunita Tools Limited is engaged in the business of engineering and mould base industry. It manufactures ground plates, mould bases, and precision CNC machining.
The company’s products serve as essential components for the manufacturing industries, spanning automotive, pharmaceutical, electronics, consumer goods, aerospace and numerous other sectors.
Written by Shivani Singh
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