Shares of Praj Industries rose 9 percent to an all-time high of Rs 453.65 in intraday trade on Thursday, on strong volumes and hopes of strong order inflows in the coming quarters. The stock has crossed its previous high of Rs 448.25, which it had touched on January 20, 2022.
At 12:20 p.m.; Praj Industries traded 8 percent higher at 448.15 rupees a share, a two-fold increase in average trading volume. In comparison, the S&P BSE Sensex was up 0.66 percent at 58,449 points. A combined 5.41 crore shares have changed hands on NSE and BSE so far.
Praj is engaged in the business of process and project engineering. The company serves both the national and international markets. In addition, the company also offers design and engineering services.
The company remains optimistic about the ethanol industry beyond the E20 target. Several policy measures under discussion, such as flexible fuel vehicles, conversion of stationary diesel engines to ethanol, diesel blending program, export of ethanol under certain circumstances, are likely to further boost ethanol demand. These help support sustained demand for ethanol beyond calendar year 2025 (CY25), the company said.
In addition, they also believe that the commissioning of the first second-generation ethanol plant will strengthen confidence among potential developers both nationally and globally.
“Ecosystem development is still ongoing for the compressed biogas (CBG) business in India. The commissioning of the initial commercial-scale CBG projects in the near future will demonstrate the end-to-end operation of the value chain. This will help create a significant CBG capacity as envisaged in the SATAT Policy,” the management stated.
Analysts believe the company looked positive on strong order flows in the coming quarters, given the government’s target of achieving 20 percent ethanol blending by 2025 (EBP-20).
“2G ethanol, in the view of the management, is significant in the context of carbon reduction and there is a lot of interest not only in India but also in the overseas market, especially in Europe. They also indicated that compressed biogas (CBG) is in the initial. and there is interest from both the government and the private sector, especially after indexing its prices with the GNC,” analysts at Kotak Institutional Securities said.
In addition, analysts also believe that the company’s technological capabilities in the bioenergy and future technology segment will reduce the carbon footprint.
“There are significant opportunities in 1G, 2G, CBG (Compressed Biogas), SAF (Sustainable Aviation Fuel) etc. In our view, Praj can command its historical valuation based on its strong market position in the space, which is well supported by positive outlook on the order book and strong long-term business prospects,” the brokerage firm added.