This 2023-listed stock rises 14% intraday on signing contract with Mitsubishi Heavy Industries; shares are up 131% since listing

In a filing on November 3, Azad Engineering informed the exchanges that it has signed a long-term contract and price agreement (LTCPA) with Mitsubishi Heavy Industries Limited. As part of the agreement, Azad Engineering will supply highly engineered and complex rotating and stationary Airfoils for Advanced Gas and Thermal power turbine engines to meet their global demand in the power generation industry.

The company informed the bourses that the current phase of the contract is valued at $82.89 million (₹700 crore). Azad Engineering added that the contract signifies a robust step towards cementing its strategic relationship with Mitsubishi Heavy Industries Limited, Japan (MHI). The contract is to be executed over five years.

The company recently laid out a dedicated manufacturing plant for Mitsubishi Heavy Industries, which is set to be operational in the coming two to three quarters, per management’s latest estimates. Azad Engineering started supplying Mitsubishi Heavy Industries in 2012 and has been associated with them as a qualified supplier of major components. In addition, Azad Engineering is also the single most supplier to such parts outside Japan for Mitsubishi.

On October 24, Azad Engineering received a business award from Honeywell Aerospace ISC, USA, for manufacturing and supplying complex components to meet the global demand in the aviation industry. The company informed the stock exchanges that Phase 1 of the award was worth $16 million.

Azad Engineering IPO launched its ₹740-crore initial public offering (IPO) in December 2023. Shares of the company were listed on the NSE on December 28 with a premium of 37% at ₹720 apiece. The stock listed at ₹720 apiece on the NSE, at a premium of over 37% per share.

Since its listing, the stock has gained over 127% from its listing price of ₹720. The stock has given year-to-date returns of over 136% while rising more than 31% in the last six months. In the last one month, the stock has rallied 16%.

Shares of Azad Engineering were trading at ₹1,644 apiece, up by 12.4%, on the NSE at 09:45 am.