Monday, February 26, 2024
Google search engine
HomeBusinessITI soars 10% as board plans to mull equity share issue to...

ITI soars 10% as board plans to mull equity share issue to the government


Shares of ITI edged higher by 10 per cent to Rs 113 apiece in Wednesday’s intra-day trade, on the back of heavy volumes, ahead of their scheduled board meeting to consider issue of equity shares to the government.

At 11:20 am; the stock traded 8 per cent higher at Rs 111.95, as compared to 0.22 per cent decline in the S&P BSE Sensex. The average trading volumes on the counter jumped over 9-fold, as around 6.05 million equity shares changed hands on the NSE and BSE.

“A meeting of the board of directors of the company will be held on Wednesday, September 28, inter alia to consider and approve allotment of equity shares to the President of India, against capex infusion, as per the revival package of BIFR order dated January 8, 2013,” ITI said in an exchange filing on September 20.

ITI manufactures telecom equipment like electronic switching exchanges, transmission equipment, microelectronic and telephone instruments, among many others. The company has undertaken many initiatives or projects, in order to boost the turnover and implement the revival plan.

The company has planned turnover of Rs 2,842 crore for FY2022-23. ITI is focusing on manufacturing in a big way and plans to take up turnkey projects as ystem Integrator (SI), to increase the value addition. The company expects to execute a defence order of Rs 7,796 crore contract for Phase IV of the Army Static Switched Communication network (ASCON) project.

“The continued support from the government is helping ITI to manufacture products in different market domains in a big way. The company is now manufacturing many new telecom products like High speed Wi-Fi Access Points, G-PON, OFC and Solar panel products. ITI has won contracts of BharatNet projects like TANFINET, Andaman and Nicobar OFC and IAF 4G LTE projects. In addition major focus has been given by the company to manufacture encrypted telecommunication equipment required for defence sector,” the company said in a recent report.

Meanwhile, the rating agency ‘Acuite’ has reaffirmed and assigned a long-term rating of ‘ACUITE BBB+’ and the short term rating of ‘ACUITE A2’ on the Rs 4,469.50 crore bank facilities of ITI, with a stable outlook.

Highlighting the rationale behind the ratings upgrade, the agency said, “The rating reaffirmation takes into account extensive experience of the ITIL’s management and healthy order book position of more than Rs 8,800 crore. It also draws comfort from the support and strong shareholding of the Government of India (GoI) with ~90 per cent stake in ITI and its support to ITI through revival package and letter of comfort.”

That said, high working capital intensive nature of operations and below average financial risk profile will challenge strengths of the company, analysts said. They also believe that the company’s ability to maintain its scale of operations while improving profitability will remain a key rating sensitivity.


Source link

- Advertisment -
Google search engine

Most Popular

Recent Comments