Buy Atlanta Electricals; target of Rs 1980: Motilal Oswal

What happened

Motilal Oswal reiterated its BUY rating on Atlanta Electricals and raised its target price to INR1,980 from INR1,950. The broker said quarterly revenue and EBITDA matched its estimates, while lower depreciation helped profit beat estimates; monsoon disruption, deferred deliveries and higher raw-material prices affected execution.

Confirmed

Global impact / market context

The higher target reflects the broker’s valuation view, not guaranteed returns. Near-term execution and order inflows matter because delays can push revenue recognition back, while higher raw-material costs can pressure profit per sale. A delayed 765kV facility could also postpone a potential source of future growth.

Analyst inference

The report describes mixed operating signals: quarterly revenue and EBITDA met estimates, but inflows weakened from the prior quarter and execution faced weather, delivery and input-cost disruptions. The broker expects improvement in the second half, while 765kV technology work in-house may delay orders and production ramp-up.

Analyst inference

What to watch

1. Watch whether inflows and execution recover in the second half of FY27, as the company expects; sustained improvement would support deliveries and revenue. Analyst inference
2. Track completion of the 400kV facility’s short-circuit test, which the report says is expected by December; this is a stated company focus. Confirmed
3. Follow progress on developing 765kV technology in-house and any resulting order or execution delays, since discussions on a technology tie-up have not yielded results. Analyst inference

Evidence

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