HBL Power Systems Stock Jumps Over 10% on Securing ₹762 Crore Kavach Orders

Following acquiring five contracts totaling ₹762.56 crore for the Kavach system over 413 stations, HBL Power Systems’ stock increased 10.3% to ₹520.65. With contracts just obtained totaling ₹2,182.84 crore, this is the third order victory in March.

Following several orders from Central Railway, HBL Systems, a primary battery and systems industry participant, saw its shares jump 10.3% in intraday trading on Tuesday, April 1, to a six-week high of ₹520.65 per share.

Through an exchange filing on Monday, the firm notified investors that it had obtained five Letters of Acceptance for providing Kavach over 3,900 kilometers and 413 stations. According to the document, the entire value of the five contracts, including 18% GST, is ₹762.56 crore, and each contract must be finished within 18 months.

This was the third order victory for the business in March. The company said on Friday that North Central Railway and Western Railway had sent two Letters of Acceptance to the HBL-Shivakriti Consortium.

The first order was for Kavach to be provided in the Rajkot Division, Western Railway’s Viramgam–Rajkot–Okha Section, while the second was for the Jhansi Division, North Central Railway’s Dholpur–Bina Section. With a total estimated value of ₹500 crore, both projects should be finished in more than 700 days.

In March of last year, the Bhopal Division sent the consortium a Letter of Acceptance for an order totaling ₹148.44 crore (including 18% GST) for the provision of Kavach in the BPL-SHRN section, the Bina-Itarsi-Jujharpur section, and the UP and DN flyover track from Powarkheda of the Bhopal Division, West Central Railway.

KAVACH is a cutting-edge safety system that reduces train crashes and improves operating safety. It is sometimes called the Automatic Train Protection System (IRATPS) or the Train Collision Avoidance System (TCAS).

The stock has produced an outstanding 441% return over the previous two years and 741% over the last three, despite a steep decline from recent highs. The company has continuously produced good returns when viewed by its yearly performance, with notable increases of 160% in CY20, 53% in CY21, 67% in CY22, 312% in CY23, and 43% in CY24.

However, the company has seen significant profit booking this year amid a broader market Purchase, which has caused it to trade 30% below its most recent high of ₹739.45 per share.