Synopsis: Azad Engineering shares jumped 3.17% after securing a landmark 8-year single-source contract with Japan’s Mitsubishi to supply high-precision hot-section turbine components globally.
Azad Engineering has secured a landmark contract that sets a new benchmark for Indian precision manufacturing. The shift from cold-section to highly complex hot-section parts is a significant increase in technical capability that will be hard for competitors to match.
Following the announcement, Azad Engineering which holds a market capitalization of approximately Rs 9,596 crore saw its stock momentum surge, reaching an intraday high of Rs 1,601.90 on the BSE.
News
Azad Engineering rose 8.73% to Rs 1,601.90 after the company signed an 8-year long-term contract and price agreement with Mitsubishi Heavy Industries (MHI), Japan, to supply complex hot-section nozzle vane segments for gas turbine engines.
The company has been selected as a single-source supplier, marking a transition from manufacturing compressor (cold-section) components to critical combustion hot-section parts, thereby expanding its partnership with MHI.
The components will be manufactured at MHI’s dedicated lean facility for advanced gas turbine platforms catering to global power generation markets. The company termed the agreement a milestone, marking its entry into high-precision turbine components.
Azad Engineering is engaged in the manufacturing of precision forged and machined components for clean energy, aerospace, defense, oil and gas, and standalone power supply (SPS) as required by OEMs with its manufacturing unit in Hyderabad. The company’s consolidated net profit surged 46.4% to Rs 34.72 crore on a 31.7% increase in revenue from operations to Rs 158.72 crore in Q3 FY26 over Q3 FY25.
Business Overview
Azad Engineering has a high profile growth with a P/E ratio 78.26, strong ROCE of 12.2% and ROE of 8.58% backed up by high Capex in its Hyderabad plant. The firm focuses on precision forged components to the international aerospace, defense, and energy OEMs, and needs the highest technical accuracy. The new 8-year single source agreement with Mitsubishi is a pivotal transition of its parts off of cold-section to high-value hot-section turbine segments.
The effect of this jump in technology is observed in the Q3 FY26 net profit increasing by 46.4% to Rs 34.72 crore. Finally, the findings also underscore the growing Indian dominance in the world high-precision engineering supply chain.
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