DCX Systems stock price jumps 16% to touch fresh all-time high on ₹1250 cr order win

DCX Systems saw its shares surge by 16% to reach a record high of ₹440 each early today, following a major development. The company announced securing a substantial order worth ₹1,250 crore from Larsen & Toubro Limited. This order, disclosed in a filing on Monday, involves the manufacture and supply of electronic modules.

This achievement marks DCX Systems' second significant win in less than two weeks. Previously, it had secured an order valued at ₹33.2 crore for the supply of cable and wire harness assemblies to both domestic and overseas clients.
 

DCX Systems specializes in system integration and manufactures a diverse range of cables, wire harness assemblies, and kits. It has gained recognition as an Indian Offset Partner (IOP) for foreign original equipment manufacturers (OEMs), particularly in the aerospace and defence sectors.

The company finds itself well-positioned amidst a global uptick in defence spending, which is projected to rise from $2,290 billion in CY23 to $2,652 billion in CY27. This growth is driven by ongoing geopolitical tensions, modernization of armed forces, global power dynamics, evolving technology trends, and policy shifts.

In line with global trends, the defence electronics market is set to expand significantly. Estimates indicate it will grow from $142 billion in CY22 to $237 billion in CY30, while the defence electronics market specifically is expected to increase from $2,577 million in CY22 to $7,204 million in CY30.

In Q4 FY24, the company reported a revenue of ₹746.20 crore, a notable increase from ₹510.55 crore in Q4 FY23. However, there was a slight decline in EBIT, which stood at ₹51.91 crore in Q4 FY24 compared to ₹55.16 crore in Q4 FY23.

This resulted in a reduced EBIT margin of 6.96% in Q4 FY24, down from 10.80% in Q4 FY23. Profit after tax (PAT) also decreased to ₹32.95 crore in Q4 FY24 from ₹41.13 crore in Q4 FY23.

While the profit after tax (PAT) for the full year has improved marginally to ₹75.78 crore in FY24 as compared to ₹71.68 crore in FY23,. Its order book as of March 31, 2024, is over Rs. 801.16 crore.

Recent developments

The company has made significant strides in its operations. It entered into a Supply and Services Agreement with Israel Aerospace India Services Private Limited for the supply and repair services of spare parts and electronic components, focusing on Maintenance, Repair, and Overhaul (MRO).

Additionally, the company secured a purchase contract/order worth US$ 1.99 million (approximately ₹16.53 crore) from Lockheed Martin Corporation, USA.

Furthermore, it also received export orders from overseas customers totaling approximately US$55.13 million (approximately ₹457.58 crore). These developments highlight the company's growing international footprint and its capability in the aerospace and defence sectors.

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