Pitti Engineering Limited updates on capex

The Board of Directors of Pitti Engineering Limited at their meeting held on 25th June 2020 had approved a capex of Rs. 270 crore. The company has incurred an amount of Rs. 137 crore so far and commissioned the enhanced capacity by accommodating the machines in its existing buildings to meet the increased customer requirement. The capacity as on date stands enhanced to 46,000 MT for sheet metal and 4,03,200 machine hours. The Company is currently operating at around 80% capacity.

The Board of Directors at its meeting held today reviewed the ongoing capex as well as the current business pla4 order book visibility and keeping in mind the operational challenges being faced due to the comnlissioning of the enhanced capacity in the existing buildings has decided to approve an additional capex of Rs. 197 crore towards construction of factory buildings, reorganizing of manufacturing facilities, automation as well as enhancing the machining capacities from 4,03,600 hours to 6,48,000 hours.

The cumulative capex budget of Rs. 467 crore (including initial capex of Rs. 270 crore and additional approved capex of Rs. 197 crore) being funded by intemal accruals / issue of securities / unsecured loans and long-term borrowings from banks / financial institutions / ECB.

The said enhancement will be undertaken in a phased mamer to be completed in a span of 30 months taking the cumulative capacity in sheet metal to 72,000 MT and machining to 6,48,000 hours. This will help the company in meeting the growing demand for its products and services across various end user industries including railways, urban mass transpot, power generation and electrical vehicles. The Company will also re-organize its existing manufacturing facilities to house the majority sheet metal facility at Aurangabad and majority machining facility at Hyderabad. The aforesaid enhancement in capacity and reorganization of facilities would help the company increase its capabilities and market reach apart Irom bringing in synergies in operation, skill, and scale.

Shares of Pitti Engineering Limited was last trading in BSE at Rs. 275.05 as compared to the previous close of Rs. 285.95. The total number of shares traded during the day was 66343 in over 3920 trades.

The stock hit an intraday high of Rs. 293.40 and intraday low of 267.95. The net turnover during the day was Rs. 18481315.00.

Source : Equity Bulls

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PittiEngineering INE450D01021 Capex Update