Disa India zooms 20%, hits new high as profit more than doubles in Q1FY24

The company's revenue from operations grew 41 per cent to Rs 90.69 crore from Rs 64.19 crore in the corresponding quarter of previous year. EBITDA margin improved to 20.4 per cent from 14.0 per cent

Shares of Disa India were locked in the 20 per cent upper circuit to hit a fresh all-time high of Rs 14,770.70 on the BSE on Thursday, as of 12:03 pm. This came as the company reported a more-than-double jump in its profit after tax (PAT) at Rs 15.58 crore for the June quarter (Q1FY24).

The company, engaged in industrial products business, had posted PAT of Rs 7.53 crore in Q1FY23.

The company’s revenue from operations grew 41 per cent to Rs 90.69 crore from Rs 64.19 crore in the corresponding quarter of previous year. Earnings before interest, taxes, depreciation, and amortization (EBITDA) margin improved to 20.4 per cent from 14.0 per cent.

Thus far in the financial year 2023-24, the stock price of the company has zoomed 86 per cent. In comparison, the S&P BSE Sensex rallied nearly 12 per cent during the period.

The company is engaged in the business of manufacturing and sale of DISA Brand of Moulding Machines, Wheelabrator brand of Shot Blasting machines and other Environmental control equipment.

In the ordinary course of business, it exports products to DISA Industries A/S, Denmark and also imports spares parts, semifinished components and products required for sales in India and to be used in manufacture of above machines, pays royalty, receives sales commission and service income.

The outlook for the foundry industry remains stable as it plays a significant role in the manufacturing sector and contributes to various industries such as automotive, agriculture, infrastructure, railways & general engineering.

The growth of foundry industry reflects on the domestic & global economic conditions. India produces approximately 12.5 million ton of castings per annum and is positioned as a second highest producer in the world after China followed by US in the 3rd position. In the last few years cast production has witnessed an average growth rate of 4-5 per cent in India.

Foundry industry in India is investing across segments to build in new technology, upgrade the existing set ups and playing big at a global level. This has been witnessed across existing foundries and new investors venturing into the field, which is an encouraging sign for the industry, Disa India said in its FY23 annual report.

The government spending on infrastructure continues to run full stream. Divestment initiatives have been implemented to generate funds to use for the infrastructure development programs. This would help the company to work for new applications across segments like Steel, Construction and Energy. The company is also looking to support companies doing exports for establishing right quality for their end products. The company said it also sees many export opportunities to the Middle East, Turkey, Brazil and a few SubSaharan nations seeking to industrialize their economies.