Hitachi Energy India Reports Strong Profit Growth Amidst Market Evaluation Adjustments

Hitachi Energy India, a prominent player in the capital goods sector, has recently undergone an evaluation adjustment reflecting its current market standing. The company has demonstrated a strong capacity to manage its financial obligations, evidenced by a low Debt to EBITDA ratio of 0.65 times. This positions Hitachi Energy favorably in terms of financial stability.
In the latest quarter, Q3 FY24-25, the company reported a significant annual growth rate of 21.55% in operating profit, alongside a remarkable 162.73% increase in net profit. These results mark a continuation of positive performance, as the company has consistently delivered favorable results over the past four quarters. Notably, the profit before tax, excluding other income, reached Rs 131.95 crore, reflecting a growth of 99.0%, while net sales for the half-year stood at Rs 3,174.01 crore, growing at 26.85%.

Despite these strong fundamentals, the technical trend has shown signs of sideways movement, indicating a lack of clear price momentum. The stock's valuation appears high, with a return on capital employed (ROCE) of 19 and an enterprise value to capital employed ratio of 34.7. However, it is trading at a discount relative to its peers' historical valuations.

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