Elgi Equipments

Elgi Equipments share is in Bullish Momentum

Technical Analysis:

Elgi Equipments share is in a bullish momentum trading. On the daily chart, the script has formed a bullish flag pattern last week. On 17th June 2022, the stock closed at 390 level which is near its all-time high of around 422. The stock can reach this target in a short period.   It is an immediate target level. On the downside, the 360 level can be treated as immediate support. Below this level, there is a strong demand zone. Further, the stock is trading above all its major moving averages and super trend.

Momentum indicators such as ADX and MACD are in a bullish trend to support the current strength of the stock.  The stock is moving with a higher high despite weakness in the broader market. The daily volume of the stock has been closing in green near both its long- and short-term moving averages. 

The stock has formed a cup and handle pattern in weekly chart at the 360 level. Despite the downward trend in the broader market, the Elgi equipments share is trading above the 20-day exponential moving average. The trading volume of the stock also seems strong in the weekly chart that exceeded its major averages. The counter has formed a triple bottom at 276 level on the weekly chart. This will be treated as strong support on the chart in the medium term. Once the stock price closes above the 422 level with strong volume, the counter will touch the 500 level.

Fundamental Analysis:

ELGi Equipments is a global leader in providing sustainable compressed air solutions. The company has around 60 years of experience in manufacturing air compressors. ELGi Equipments designs and manufactures an extensive range of compressed air solutions for a variety of applications. The company caters across industries such as textile, manufacturing, pharmaceutical, agriculture, mining, healthcare, automotive, and construction. The company has a presence in over 120 countries with 2 million installations.  

Dr Jairam Varadaraj is the Managing Director of Elgi Equipments He has nearly 30 years of experience in different areas of business. Before this, he has been serving as former Chairman of the Tamil Nadu State Committee of the Confederation of Indian Industry (CII) and a past member of the Southern Region Council of CII. He holds a master’s degree in Business Administration from George Washington University, USA. In addition, he is also a Ph.D. in international business from the University of Michigan, USA.

The market cap of Elgi is INR 12650 crores. The Elgi share is available at 71 PE and 14.54 prices to book value. The Company recorded a growth of 15% in net income at a yearly rate against the industry average of 7.32% over the last 5 years. The company recorded total revenue of INR 2581 crores in 2022 from INR 1875 crores in 2019. EBITDA also grew from INR 205 Cr in FY 2019 to INR 348 Cr in FY 2022. EPS has also doubled from 3.25 to 5.64 over the same period.

Elgi Equipments Share Daily Chart
Elgi Equipments Share Weekly Chart

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