Thermax is an A /T+1 group Heavy Electrical Equipment company with having Face value of Rs. 2. Thermax Limited offers solutions to energy environment and chemical sectors. The Company's portfolio includes boilers and heaters absorption chillers/ heat pumps power plants solar equipment air pollution control equipment/system water and waste recycle plant ion exchange resins and performance chemicals and related services. It operates globally through 34 international and 22 domestic offices 14 manufacturing facilities - 10 in India and 4 overseas spanning Europe and South East Asia. The company's international presence spans 90 countries across Asia South East Asia Africa Europe Americas and the Middle East. It has 10 wholly owned domestic subsidiaries and 22 wholly owned overseas subsidiaries.

Fundamentals (FY22-23):

Financial Results:

Company’s Net Sales was at Rs 2,049.25 crore in December 2022 up by 26.91%, Quarterly Net Profit at Rs. 126.19 crore in December 2022 up by 58.83% and EBITDA stands at Rs. 203.40 crore in December 2022 up by 42.97% compared to December 2021.

List of recent updates regarding the company:

1. Thermax Limited Fortescue Future Industries (FFI), an Australia-based green energy and green technology company, have signed a Memorandum of Understanding (MoU) to explore green hydrogen projects – including new manufacturing facilities – in India. The MoU between Thermax and FFI also contemplates the potential collaboration of the parties in the development of new manufacturing facilities to support green energy projects in India.
2. The company has recently has concluded an order of Rs. 522 crores for utility boilers and associated systems for a grass root refinery and petrochemical complex in Rajasthan, India. The order includes two units of 260 TPH high pressure utility boilers along with allied auxiliaries to be designed and manufactured by Thermax Babcock & Wilcox Energy Solutions (TBWES), a wholly owned subsidiary of Thermax.
3. The company also bagged an order of Rs. 545.6 crore from an Indian power public sector company to set up flue gas desulphurization (FGD) systems for their two units of 500 MW capacity each in the state of Uttar Pradesh, India. The FGD systems will be installed at their plant to cut down SOx emissions and comply with the air quality standards set for the power plants.
4. Thermax recently announced the expansion of its Solar business, transitioning from the present rooftop-based Capex model to the solution-based Opex model. The new business, to be helmed by Thermax’s subsidiary, First Energy Private Limited, will work closely with customers in the commercial and industrial space and support their decarbonising journey by providing optimised renewable power. First Energy strives to set up open access based solar and solar hybrid farms, hybridising solar with storage and other solutions and delivering appropriate renewable power to customers.
5. Thermax Babcock and Wilcox Energy Solutions (TBWES), a wholly owned subsidiary of Thermax recently bagged an order worth Rs. 293 crore order for a boiler package comprising 3 x Oil & Gas fired boilers on EPC basis for a refinery and petrochemical complex in western India.
6. Thermax Babcock & Wilcox Energy Solutions Private Limited (TBWES), a wholly owned subsidiary of Thermax recently signed a know how transfer and license agreement with Steinmüller Babcock Environment GmbH (SBE), Germany for Waste to Energy technology. As a part of the agreement, TBWES will design, engineer, manufacture and sell Municipal Solid Waste (MSW) fired waste to energy solutions incorporating SBE’s well established grate and boiler technology.
7. Thermax, has concluded a Rs. 250 crore order for a claus package and an oxidiser package in the sulphur recovery unit for a greenfield refinery in Latin America. The client company, is setting up a new 340 MBPD (Million Barrels Per Day) crude oil refining capacity to increase the production of high value distillates.
8. Thermax Group has bagged an order to set up a captive Combined Heat and Power (CHP) plant on an EPC basis for Assam Bio Refinery Private Limited (ABRPL), a joint venture of Numaligarh Refinery Limited (NRL), Fortum and Chempolis. ABRPL is developing India’s first biorefinery to produce cellulosic ethanol from bamboo biomass.
9. The company also launched ‘atoM’, a completely modularised and ultra-compact sewage recycle system to treat sewage water efficiently in confined spaces. The product is suitable for commercial and residential segments, given its contemporary aesthetics, sleek design and easy installation, operation & maintenance features.
10. As on December 31, 2021, order booking for the quarter was 57 % higher at Rs. 2,462 crores (Rs. 1,565 crore) in the corresponding quarter, last year. Thermax Group had an order balance of Rs. 7,389 crores (Rs. 5,208 crore), up 42 %.

In last 3 years the stock gave a return of 195.01% as compared to Sensex which gave a return of 89.20% and 195.51% return compared to 90.36% rise in Nifty.

Thermax’s new product aTom will also play an important role in driving sales for the company considering the rise in real estate projects across the country. The Performance Linked Incentive (PLI scheme), under India’s National Green Hydrogen Mission, could be leveraged to the company for setting up any new manufacturing capacity and it will help in meeting domestic as well as international demands for electrolyzer which will benefit to the company a lot in upcoming years. Company’s Solar business is projected to grow to a GW scale based on its Opex strategy. Company’s foray into projects related to greener future of India is paving ways for India’s target of reaching minimum net emission of CO₂ in upcoming years. Company is doing great with its healthy financial and long-term income generating projects along with existing order book so investors looking for safe investments and healthy returns can add this company’s stock into their portfolios for long term period. 

 - HET ZAVERI

info@smartinvestment.in

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